What are the best stock market hedges? They might not be what you would think. With the stock market approaching the upper end of a trading range, with some calling resistance near 2,000 on the S&P 500, the question of how investors might want to hedge comes to mind. While obvious hedges such as purchasing S&P 500 put options or more sophisticated plays in the VIX volatility index come to mind, a global asset allocation piece from Bank of America Merrill Lynch takes a creative approach to hedging, identifying outperforming hedge tactics relative to the obvious choices. “If equities decline,…
BAML: Best Stock Market Hedges Are Not Most Obvious
Mark Melin
Mark Melin is an alternative investment practitioner whose specialty is recognizing the impact of beta market environment on a technical trading strategy. A portfolio and industry consultant, wrote or edited three books including High Performance Managed Futures (Wiley 2010) and The Chicago Board of Trade’s Handbook of Futures and Options (McGraw-Hill 2008) and taught a course at Northwestern University's executive education program.