fxtrader07

Protect Your Portfolio: Here Comes the Squeeze

hm, the tricky part of course is, WHAT to short now to protect a portfolio. financials may sink further, but i believe shorting financials is becoming a low reward-high risk position, increasingly. the whole s&P? well, not so fast! quite a lot of energy and financials make up the index. energy and commodity-related stocks have been beaten up and some absolutely hammered over the past weeks. so enertgy and financials may put a rather solid floor under the index. retailers, on the other hand, need to be examined 1by 1. wmt has obviously profited and will continue to profit from the economic climate. at the very least, they will not see a dramatic deterioration in their profits. amzn, on the other hand might get a rude awakening, in part thanks to the diminishing gains from dollar-depereciation. so amzn would be my favourite retailer short as it will get hurt by global slowdown and carries still insane valuations. that brings me to the nasdaq and tech stocks. i think they will be the most vulnerable as most of them rely on growth to justify their p/Es - and this growth may fall apart. but here again, the sectors ought to be taken one by one. semiconductors, for instance, look rather cheap