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Author Topic: What do you guys use to hedge?  (Read 252 times)

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NuttinItUp

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What do you guys use to hedge?
« on: June 04, 2020, 02:36:39 pm »

Traditionally bonds have served as a good hedge. (i.e. t-bond investments move up when stocks move down) However, over the last few months of the crisis, it seems like a lot of the time both are moving in the same direction at the same time. Obviously, this isn't a very effective hedge if you want something that will move up when the market goes down.

What are you guys using as a hedge?
Gold? Something else?
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Vantage 8 dude

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Re: What do you guys use to hedge?
« Reply #1 on: June 04, 2020, 02:57:39 pm »

A lot of folks use invertse ETFs. Designed to do exactly what your asking. They are designed to go down depending on the index they’re tracking. Another idea would be to “short” individual indexes and/or specific stocks/sectors you believe are poised to fall. While gold is sometimes used for this purpose the inverse relationship between this particular commodity may not always be true. 
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Dumb ole famrboy

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Re: What do you guys use to hedge?
« Reply #2 on: June 04, 2020, 05:22:56 pm »

I always compare the quinella odds multiplied by two and compare it to the exacta odds before placing a boxed a bet.

ricepig

Re: What do you guys use to hedge?
« Reply #3 on: June 04, 2020, 06:16:14 pm »

I always compare the quinella odds multiplied by two and compare it to the exacta odds before placing a boxed a bet.

I just bet on the grey.

ricepig

Re: What do you guys use to hedge?
« Reply #4 on: June 04, 2020, 06:19:58 pm »

Traditionally bonds have served as a good hedge. (i.e. t-bond investments move up when stocks move down) However, over the last few months of the crisis, it seems like a lot of the time both are moving in the same direction at the same time. Obviously, this isn't a very effective hedge if you want something that will move up when the market goes down.

What are you guys using as a hedge?
Gold? Something else?

Yeah, I’m in a 70/30 stocks/bonds portfolio, when the markets were tanking, it seemed they both were going down the same, but I noticed looking yesterday after selling a % after this up move, that the bonds were further green, up, than I thought for the year. I really don’t hedge, I just get bin the fetal position when it’s a deep downtrend and ride it out.
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NuttinItUp

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Re: What do you guys use to hedge?
« Reply #5 on: June 05, 2020, 10:02:53 am »

A lot of folks use invertse ETFs. Designed to do exactly what your asking. They are designed to go down depending on the index they’re tracking. Another idea would be to “short” individual indexes and/or specific stocks/sectors you believe are poised to fall. While gold is sometimes used for this purpose the inverse relationship between this particular commodity may not always be true. 

Sorry, I should have been more clear in my question. I am looking for things that are negatively correlated (or, more precisely, uncorrelated) with the underlying index but move positively. (Obviously if I own something and short that same thing, it kind of defeats the purpose.) 20-year T-Bills have been getting kicked in the teeth the last few days and that is generally the hedge I use, so I was looking for something better.
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rzrbackramsfan

Re: What do you guys use to hedge?
« Reply #6 on: June 05, 2020, 03:47:55 pm »

Options
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Anybody

Re: What do you guys use to hedge?
« Reply #7 on: June 27, 2020, 02:43:52 am »

Dinar
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je100

Re: What do you guys use to hedge?
« Reply #8 on: June 28, 2020, 11:41:38 am »

Traditionally bonds have served as a good hedge. (i.e. t-bond investments move up when stocks move down) However, over the last few months of the crisis, it seems like a lot of the time both are moving in the same direction at the same time. Obviously, this isn't a very effective hedge if you want something that will move up when the market goes down.

What are you guys using as a hedge?
Gold? Something else?

Seems like the nature of stocks/corp bonds to converge under extreme duress - did the same in 08, particularly because the solvency of companies come into play which affects equity and debt holders alike.

I'd still look to long term treasuries funds/etf's specifically, which are up in the 20% range YTD.
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