Sigh, wish there were a book which could explain hedging in trading that way it's done by you, Handle123. I wouldn't know where to start to hold longer positions through hedging (and not get blown-out along the way), coming from simple futures day trading which, for me, lasts from 1-30 mins a go.
Considering, 99% study time, back testing dealing with risk control, which I might add is not 100% controlled, more likely not many books written, cause those who poured in many hours of study, really thinking outside the box, who wants others to know how it is done. Now anything over 29 minute timeframes gets hedged. You can use options, same futures (like a spread), stock options to hedge futures positions and you can hedge underlying then hedge the hedge.
folks are doing this completely wrong... what happened to letting the market show you where it's going.
stocks are DIRT CHEAP! saying a crash is due because it's 10 year old bull market is like seeing 2 coin flips (last 2 bears 2000 and 2008) and predicting the next must be heads..
I have long stock positions so can keep rolling in dividends and sell puts, when patterns signals higher stats of reversals, don't know if retracement or found the tops.
What I do that I am a bear or a bull? and I am neither, previous price action is fine for showing where price has been and for back testing ideas, I know the odds of equities to rise 66% of the time, and best 6 days is last 4 business days of the month and 2 days of new month. And I did not say a crash is due, no one knows if market will continue higher or lower.
Question: off the highs, how much will you lose when your opinion changes to it no longer going higher? I will not have this overall drawdown, and at my age is huge factor, but system will continue to draw dividends, profit on hedges to null losses in stocks and short futures to gain overall on new position. So in a way I am both a Bull/Bear for those who want to wear correct hat.
I am glad so many are optimistic.....I need to get to book store and see how many magazine covers talk about the Bull market, one of the best indicators of when it be sooner than later.
