Hedging Concentrated Stock Risk
Broken Pie Chart · Broken Pie Chart
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Show Notes
ZEGA Financials' Jay Pestrichelli joins to discuss how risky single stocks are and how we have developed a system to hedge that risk. Some people want to hold concentrated stock positions due to tax consequences and are reticent to sell. See how using a hedging strategy can help manage risk, schedule diversification, and use hedging profits to buy more shares otherwise known as the hedger's opportunity. See the show notes below for links discussed in episode and other Jay and Derek episodes.
What is concentrated single stock risk?
How much more risk is holding just one stock compared to a diversified portfolio?
How do people wind up with large concentrated stock positions?
How can direct hedges mitigate downside risk?
Why covered calls are not a hedge
What is the hedgers opportunity?
Irrational decisions at market bottoms and tops
Markets are near all-time highs more often than you think
Despite impressive historical returns Apple stock has experienced huge drawdowns
How hedging single stock risk can solve problems for advisors and investors
Mentioned in this Episode:
Contact Derek www.razorwealth.com
Derek Moore's book Broken Pie Chart https://www.amazon.com/Broken-Pie-Chart-Investment-Portfolio/dp/1787435547/ref=sr_1_1?keywords=broken+pie+chart&qid=1558722226&s=books&sr=1-1-catcorr
Article showing how investors made poor decisions at market bottoms https://zegafinancial.com/blog/can-buffered-and-hedged-equity-strategy-save-investors-from-making-behavior-mistakes
Jay Pestrichelli previous podcast appearances https://zegafinancial.com/in-the-news/podcast