Hi Gary. I own some dollar index futures as a hedge against long positions. I also have a short position in XHB and SPX. Are you suggesting that stock shorts are a better hedge than US dollars?
Gary December 13, 2022
No, not at all Bart. The best hedge to me has been cash paying out interest. As for the futures, I would not make that bet at this time as a hedge because I am not feeling good about Uncle Buck’s ability to perform his normal role as liquidity receiver simply because he rallied so strongly in negative divergence to the inflation trades already.
In short, I’d rather hold a lot of interest bearing cash, continue to focus on gold related items and take potshot shorts at the stock market here and there. But only as a hedge, due to my psych profile that does not allow me to be a gung ho bear.
Bart December 13, 2022
Much appreciated Gary – points well taken. In shorting your profit tends to come all at once, which means a lot of nerve-racking waiting and time to second guess yourself:) You need the right mindset for that, yes. I am not great in it either. So I only hedge. Let’s see what happens tomorrow. Two big days in row.
Hi Gary. I own some dollar index futures as a hedge against long positions. I also have a short position in XHB and SPX. Are you suggesting that stock shorts are a better hedge than US dollars?
No, not at all Bart. The best hedge to me has been cash paying out interest. As for the futures, I would not make that bet at this time as a hedge because I am not feeling good about Uncle Buck’s ability to perform his normal role as liquidity receiver simply because he rallied so strongly in negative divergence to the inflation trades already.
In short, I’d rather hold a lot of interest bearing cash, continue to focus on gold related items and take potshot shorts at the stock market here and there. But only as a hedge, due to my psych profile that does not allow me to be a gung ho bear.
Much appreciated Gary – points well taken. In shorting your profit tends to come all at once, which means a lot of nerve-racking waiting and time to second guess yourself:) You need the right mindset for that, yes. I am not great in it either. So I only hedge. Let’s see what happens tomorrow. Two big days in row.