Tag Archive | "hedge"

How to Be Risk-Averse

Thursday, November 12, 2009

6 Comments

Felix Salmon is skeptical about the ability of average investors to protect themselves from major economic risks: [T]here really isn’t an easy or obvious way for an investor to be highly risk-averse in this market, not when one of the biggest tail risks that people want to protect themselves against is inflation. Big investors can try taking the Taleb approach of buying large numbers of out-of-the-money options and reckoning that a bunch of them will pay off when the next…

The Long Palin Vertical Spread

Tuesday, September 2, 2008

1 Comment

As the market sighs and concedes a monster gap up, isn’t it good to know that there’s always a bull market somewhere?  We’re speaking, of course, about the Intrade contract betting that Sarah Palin will withdraw (or, more likely, be withdrawn) as the Republican VP nominee before the 2008 election. If you were actually long this PALIN.VP.WITHDRAWN contract, perhaps you could hedge the gamble with some long 2008.PRES.McCAIN, on the view that these might be close to inversely…

Close trade alert: Sept SPY Iron Condor

Monday, August 25, 2008

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Avoid Options on Inverse Index ETFs

Wednesday, June 25, 2008

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Reader S. V. raises an interesting question: I am working on scenarios to trade the contra-ultra indexes like SDS to take advantage of either a combo spread (selling puts and buying call) or another method to take advantage of price movements while reducing risk.   Any thoughts? Interesting idea.  These Ultrashort ETFs have really gained in popularity and most of them (like SDS, DXD, QID) now have enough volume to make them decent trading vehicles.  The actual stock, that is.  The…

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Jared Woodard specializes in trading volatility as an asset class. With over a decade of experience trading options and other volatility products ... Read More

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