Put vjernika hedge option


Put Hedge Option StrategyWhen you are holding assets that you are reluctant tosell, but optioon are bearish on the market, you can buy putsas a hedge to help protect yourself against a marketdecline.If you are holding a diversified portfolio and you feel itis vulnerable to a market decline, you could buy indexputs to protect the whole portfolio. Select an index thatbest represents your portfolio. In times of uncertainty and volatility in the market, some investors turn to hedging optjon puts and calls versus stock to reduce risk.

Hedging is even promoted by hedge funds, mutual funds, brokerage firms and some investment advisors. (For a primer on options, refer to our Option Basics Tutorial.)Hedging with puts and calls can also be done versus employee stock options and restricted stock that may be granted as a substitute for cash compensation.The case for hedging versus employee stock options tends to be stronger than the case for hedging versus stock.




Hedge option put vjernika

Hedge option put vjernika