Posted April 05, 2021
By Scott Stewart
🔥 S&P Breaks above 4,000
Welcome back to the Rude Awakening for Monday, April 5, 2021.
The market has just hit brand-new all time highs. We are once again at a NEW highest point in history, with the S&P officially pushing past and holding above the 4,000 level.
So, today, we want to look at a way to prudently hedge ourselves with all of this pushing up and up and up.
Something that I do perennially in my portfolio is have onto a short position in place, cash flowing that by selling cash-secured puts. Its a way to generate income while waiting for a correction. But its main goal is to balance out my long positions.
One of the questions Ive been getting a lot over the past few days is this
Is There a Way to Hedge Against Downturns in the Marketplace?
The simple answer is, no, you cant make one move to perennially hedge yourself against downside fallout.
But the good news is, there is a strategy you can employ when we see some weakness in the markets.
Thats exactly what Im going to show you today.
Have a great trading day, folks.
Well see you back here tomorrow.
Scott StewartEditor, Rude Awakening