10/25/2015 @ 11:17 AM
Steve Blumenthal, Contributor
CMG Capital Management Group CEO writes about hedging equity exposure in overvalued markets in his latest Forbes article titled Using ETFs And Options To Hedge Equity Exposure In An Overvalued Market. Some excerpts from the piece:
“Many equity investors are feeling okay right now. Yes, the 2008 financial crisis was downright scary, with exploding credit spreads, disappearing financial institutions, and sharply declining stock market. However, if investors have stayed in equities since then, their wounds have healed.”
“The hard reality is that recessions happen. During a recession, the market tends to decline more than 40%. We tend to have recessions every 7–8 years. The last one ended in early 2009. Now that investors are whole again, the last thing they want to do is sit on their hands and watch their assets slip away again. We are all six years older and closer to retirement, so we have less time to recover from market declines.”
Full Forbes article: Using ETFs And Options To Hedge Equity Exposure In An Overvalued Market