decipher

Thanks @frommi for the pointers. I will experiment with put options (may be 1%) and see how it goes. @SharperDingaan I have a concentrated portfolio. Next time market falls, I will try your suggestion. Does it need setting up pre-planned stop-loss orders? Otherwise, it might be hard to execute

@Red Lion You are right, 3% is excessive. 1% might work if the hedge can throw cash to be invested as market goes down. "Maybe 10-15% tops to avoid selling during a protracted down market." - This sounds about right to ride out downturn. @73 Reds DCA works well if downturns happen early in career. In my case, annual additions are getting small relative to portfolio. The critical thing seems to have enough cash cushion to avoid selling during multi-year down markets like 2000-2003. A more general question - why would anyone hedge? Is it to manage short-term risks?

I always held high cash percentage, 25-50+%. It helped in sideways and down markets. Over long run, returns suffered. If hedging with 1-2% allows me to be fully invested, I am guessing it will pay for itself.

Have been thinking of hedging portfolio systematically. Gemini gave an idea of using 1-3% of portfolio on 1Y SPY puts (or alternate indexes) at .12 delta. Check monthly, harvest 50% of gains if delta slowly gets to .25 or .35 otherwise leave the hedge alone. During fast crashes, aggressively roll the puts lower (use 4x as the trigger). Similarly, roll the puts higher if delta falls to .05 during recoveries. I believe 3% hedge comes from Nassim Taleb (author of black swan book). Thinking of using Shiller PE as guidance to adjust percentage of hedge between 1-3%. Is this a viable hedge? Are there any other commonly used hedging strategies for small portfolios?

Got a bid, and closed Oct'26 LQDA $20 puts sold in Feb to fund OTM calls at that time. They had ~20% premium in Feb.

Sold TGT '27 leaps, trading position (<1%)

Sold WFC, and rolled it into NU. 1% position.

CROX. Tiny trading position, will get back if it falls.

Welcome back, remember you from the FFH trade. How are you sizing your trades now?

OXY. very small position.

Yes, we do. I got the idea to use spreads after your posts in LQDA thread. LQDA price ran away before I could build a position. Thanks for sharing your strategy @Inofeisone

Increased CPNG to ~10%. Calls and spreads '28 15C, '28 20/23, '27 25/30, '28 30/35, '27 35/40. Used '27 spreads when '28 spreads did not get good fills.

GOOG: 50% FRFHF: 12% UBER: 9% SNOW: 3% CPNG: 2% LQDA: 2% Misc: 5% VFORX: 8% Cash: 8% GOOG in taxable account, might leave most of it as-is. Planning to trim UBER, exit SNOW, and increase LQDA and CPNG.

We have this option through fidelity.

http://www.vanityfair.com/business/features/2010/10/greeks-bearing-bonds-201010?currentPage=all

is it Star Hedge Managers Corp?

FFH - 40% Jockey stocks (LUK, BRK.B, SHLD) - 20% TASCX - 10% Others - 10% Cash - 20%

options do not have that high a premium. Why the discrepancy between shorting and options?