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171: How to survive market sell-offs – Perry Kaufman

Better System Trader

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Is There Anything You Can Do to Reduce Volatility?

My recommendation would be not to hedge, well, first you don't know how good that hedge will be. And even if it's good, I wouldn't hedge more than 25% to 50% of your exposure because it'll be over very quickly. If the market goes up, if you've only had 25%, you've saved some of the risk and you're still in your position 75%. You have to be careful. These are very fast. So you want to protect the risk just in case, but you don't want to go overboard.

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