#15 - My Approach to Diversification, Market Hedging on the Way Up
We have a need. A need for diversification.
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I just had a conversation on Sunday about markets at all time highs, irrational greed and the potential impact of the Corona Virus and other global market factors.
In the conversation, I was asked what I would do if I was holding stocks for the long-haul — 10+ years — in an environment when prices seem irrational and greed is continually mounting.
My answer: sell small %’s on the way up and diversify into things that might do well in a potential bear market.
This is what I’ve been doing since the start of 2020. Moving my long-term positions around (in very small chunks) into things that hedge against the risk of a potentially major correction in the markets.
Links Mentioned:
- https://www.tradingview.com/chart/ (Charts for S&P500, Gold and Bitcoin)
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▶️ 3Speak
Nice strategy, everyone should have some hard assets and now some digital assets in their portfolio as a way to manage one's risks.
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Definitely. too much of one or the other is going to get people into some rough weather ;)
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Some very good points here.
Team ROTFL
Thanks :)
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Great share. It's not safe to really cast all your eggs in one basket incase it accidentally got smashed. A good mix in asset acquisition is important.
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It is definitely an important issue. More people need to really take diversification seriously. I see it all the time where people dump all their eggs into one basket and watch that thing light on fire when something "unexpected" happens
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Great share. It's not safe to really cast all your eggs in one basket incase it accidentally got smashed. A good mix in asset acquisition is important.
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well, it certainly makes sense in this environment. I sold my stocks in the high before last and have not really owned any since... most of that money is now in crypto
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I have a large portion of my assets in the stock market, but that is my long long long term portfolio. Something that is intended to build an income for my entire life (dividend growth investing).
I also have managed to build a significant crypto portfolio that is entirely separate to that main stock portfolio. I also invest in tech companies that I believe in like Tesla or Amazon.
My primary advice to people I know is just to learn about the different options out there. It's good to have exposure to uncorrelated investments rather than dump it all into one "basket"
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any investor or business person should know that there are so much benefits one can get from investment diversification and business diversification too..
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@khaleelkazi i have always loved market hedging,hedging helped me alot when i was still doing forex trading and i am happy to see those who also have wonderful thoughts concerning market hedging and diversification....
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