My mate Phil (@sloan_phil on the Tweets) has kindly provided this Guest Blog following the recent events regarding cuts to Dividends and his action in reviewing and rejigging his Income Portfolio. I have read it a couple of times for proofing and all that and it is really good and has some excellent insights into investing in US Stocks.
Many thanks to Phil for providing WD Readers with this and a personal thank you for saving me a load of work in writing a blog this week !!
I have no doubt that regular Readers (please no Wheelie, I can’t take anymore purile and unimaginative All-Bran references), will be well aware of my borderline imbecilic obsession with Hedging my Portfolio and you must be exasperated beyond belief to see that I am writing about this well-treaded subject yet again. Anyway, it is what it is, and after the recent heavy sell-off in the Markets (which after all is exactly why I have been mucking about with Hedging for so many years, in anticipation and preparation for such an event) I feel it would be worthwhile to just get down in blog format some thoughts and observations etc. that have arisen after this episode and the Global tragedy of the Coronavirus.
Overall I am quite pleased with the Hedging I did although of course in an Ideal World I could have done it better. I guess my main area of weakness was in not Hedging in larger size (more on this in due course) and I would say another failure was in not getting a big enough Short on early enough. Other than that, and some moments of panic when I shorted more and really was lucky to get away with it, I am overall fairly happy.
This is without doubt one of those Blogs that I really should have written ages ago, but I guess it has not even occurred to me before to do it because it is about something that is so mundane and everyday for me, that I didn’t even figure that actually it might be quite useful for Readers.
For many years now I have been utterly obsessed by Hedging my Portfolio of Stocks and Long Spreadbet Positions by using Short Spreadbets on Major Indexes such as the FTSE100 and the S&P500. I think the simple truth is that I have always had a fascination with Technical Analysis (the posh name for ‘Charting’) and part and parcel of that is Short-term Trading which is very much an approach which will not work without a good understanding of some basic Technical Signals/Principles. Thankfully this experience and practice with Shorting has really helped me a lot in the current Market difficulties.
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