Hedge the incoming recession
Discussion
I recently discovered, and then promptly lost/forgot the name, of a fund that specifically aims to provide a hedge against a crash/global recession. I *believe* the guy that started it had some past performance from 07/08 to earn some kudos.
Wondering if anyone knows of any like this, and has any comment on them?
In the last quarter i've heard from multiple people, who i'd consider well placed to at least have an opinion, say current predictions are that a recession is considered likely inside two years, so i'm wondering if there's some sort of hedge i could make against that. Obviously they could be completely wrong.
I also secretly like the idea of someone betting against the system and being proved right, Big Short style.
Wondering if anyone knows of any like this, and has any comment on them?
In the last quarter i've heard from multiple people, who i'd consider well placed to at least have an opinion, say current predictions are that a recession is considered likely inside two years, so i'm wondering if there's some sort of hedge i could make against that. Obviously they could be completely wrong.
I also secretly like the idea of someone betting against the system and being proved right, Big Short style.
I have been trying to do this for the last few years and 1. failed and 2. missed out on the last major upward move in the market.
However, for what it is worth, I went to cash and bought a bunch of gold.
Not for everything.
But from a say 80-20 equities vs low risk - I am now closer to 50-50.
So that offers some downside PROTECTION but obviously not much profit from any market decline.
To do that you could probably just short the MSCI World Index / FTSE / STOXX / S&P / Dow etc... via ETFs if you can find someone to sell them to you.
Normally they aren't SIPP or ISA friendly though.
However, the above posters are correct. Timing the market is a nightmare. I am a solid case in point!
However, for what it is worth, I went to cash and bought a bunch of gold.
Not for everything.
But from a say 80-20 equities vs low risk - I am now closer to 50-50.
So that offers some downside PROTECTION but obviously not much profit from any market decline.
To do that you could probably just short the MSCI World Index / FTSE / STOXX / S&P / Dow etc... via ETFs if you can find someone to sell them to you.
Normally they aren't SIPP or ISA friendly though.
However, the above posters are correct. Timing the market is a nightmare. I am a solid case in point!
I agree with everything posted above.
A well balanced portfolio that you hold throughout different market cycles is a good bet.
Equally, defensive consumer stocks can work well in both bull and bear markets (or at least have done historically).
Also, not looking at your valuations every day probably helps!
A well balanced portfolio that you hold throughout different market cycles is a good bet.
Equally, defensive consumer stocks can work well in both bull and bear markets (or at least have done historically).
Also, not looking at your valuations every day probably helps!
I’m in a business that offers hedging services and I would generally suggest that for an investor there is little real upside.
I believe that the real ‘hedge’ is to not enter a recession with excessive debts or being particularly cash poor. Generally, long term investments are designed to chug along through the economic upswing and downs. Nothing wrong with checking those investments and ensuring they are appropriate but my general consideration is that if your investment portfolio inspires you to buy hedges then that should be more of an inspiration to check the overall structure of that portfolio.
I believe that the real ‘hedge’ is to not enter a recession with excessive debts or being particularly cash poor. Generally, long term investments are designed to chug along through the economic upswing and downs. Nothing wrong with checking those investments and ensuring they are appropriate but my general consideration is that if your investment portfolio inspires you to buy hedges then that should be more of an inspiration to check the overall structure of that portfolio.
Can't really argue with any of the above, i'll see if i can find the thing i was referring to for some fun scrutiny. A quick google returned Horseman, but it wasn't that guy.
I guess, if predictions are right - you'd just do now what you would of told yourself to do before 2007. Cash and Gold is king, buy when the streets are bloody..
Though i imagine there are some things that do well when the world is in decline you could gamble on... cheap food stores, booze/weed, crypto, cfd long vix if you're feeling really baller.
I guess, if predictions are right - you'd just do now what you would of told yourself to do before 2007. Cash and Gold is king, buy when the streets are bloody..
Though i imagine there are some things that do well when the world is in decline you could gamble on... cheap food stores, booze/weed, crypto, cfd long vix if you're feeling really baller.
The 2007 thought experiment is a good one, but I think where you make your money is on what you buy post crash rather than what you hold going in (as long as you haven’t already blown yourself up).
If I had another go I would be aggressively looking for fundamentally strong assets at distressed prices (like the good ABS paper that got dragged down by the subprime crap)
If I had another go I would be aggressively looking for fundamentally strong assets at distressed prices (like the good ABS paper that got dragged down by the subprime crap)
May The Fourth Be With You. Oh, that was last week.
As JulianPH has said, a robust approach is an investment strategy which can sustain a certain amount of downturn. As some will remember, when the excrement meets the air conditioning you suddenly find you can't get though to your broker or the internet's overloaded.
To put it another way, once you see trouble coming it will be too late to do anything about it.
As JulianPH has said, a robust approach is an investment strategy which can sustain a certain amount of downturn. As some will remember, when the excrement meets the air conditioning you suddenly find you can't get though to your broker or the internet's overloaded.
To put it another way, once you see trouble coming it will be too late to do anything about it.
rockin said:
May The Fourth Be With You. Oh, that was last week.
As JulianPH has said, a robust approach is an investment strategy which can sustain a certain amount of downturn. As some will remember, when the excrement meets the air conditioning you suddenly find you can't get though to your broker or the internet's overloaded.
To put it another way, once you see trouble coming it will be too late to do anything about it.
There’s a good argument that you ought not do anything about it anyway. Taking your money in and out of asset classes based on market movements or sentiment doesn’t seem to have any better outcomes than sticking with your allocation.As JulianPH has said, a robust approach is an investment strategy which can sustain a certain amount of downturn. As some will remember, when the excrement meets the air conditioning you suddenly find you can't get though to your broker or the internet's overloaded.
To put it another way, once you see trouble coming it will be too late to do anything about it.
Tony-K said:
rockin said:
May The Fourth Be With You. Oh, that was last week.
As JulianPH has said, a robust approach is an investment strategy which can sustain a certain amount of downturn. As some will remember, when the excrement meets the air conditioning you suddenly find you can't get though to your broker or the internet's overloaded.
To put it another way, once you see trouble coming it will be too late to do anything about it.
There’s a good argument that you ought not do anything about it anyway. Taking your money in and out of asset classes based on market movements or sentiment doesn’t seem to have any better outcomes than sticking with your allocation.As JulianPH has said, a robust approach is an investment strategy which can sustain a certain amount of downturn. As some will remember, when the excrement meets the air conditioning you suddenly find you can't get though to your broker or the internet's overloaded.
To put it another way, once you see trouble coming it will be too late to do anything about it.
Tony-K said:
rockin said:
May The Fourth Be With You. Oh, that was last week.
As JulianPH has said, a robust approach is an investment strategy which can sustain a certain amount of downturn. As some will remember, when the excrement meets the air conditioning you suddenly find you can't get though to your broker or the internet's overloaded.
To put it another way, once you see trouble coming it will be too late to do anything about it.
There’s a good argument that you ought not do anything about it anyway. Taking your money in and out of asset classes based on market movements or sentiment doesn’t seem to have any better outcomes than sticking with your allocation.As JulianPH has said, a robust approach is an investment strategy which can sustain a certain amount of downturn. As some will remember, when the excrement meets the air conditioning you suddenly find you can't get though to your broker or the internet's overloaded.
To put it another way, once you see trouble coming it will be too late to do anything about it.
When is this recession happening as I don't see much sign of it. Lots of doom and gloom stories in the media but people still seem to be out there spending money like it is going out of fashion.
Recent visit to a Mercedes dealer to test drive an A class and there was nobody free to talk to me that whole afternoon. They took my details and promised someone would call back, but two weeks on and still no call.
Recent visit to a Mercedes dealer to test drive an A class and there was nobody free to talk to me that whole afternoon. They took my details and promised someone would call back, but two weeks on and still no call.
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