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A comment on ‘A Powerful Signal of Recessions’ Has Wall Street’s Attention. Parent comment

Re:‘A Powerful Signal of Recessions’ Has Wall Street’s Atten... by solotronics on Monday June 25, 2018 @12:05PM (#17393464)
I always toyed with the idea of taking small positions far out of the money buying puts to hedge against my 401k.
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Re:‘A Powerful Signal of Recessions’ Has Wall Street’s Atten... by coliveira on Monday June 25, 2018 @12:15PM (#17393562)
Options are fairly priced. Meaning that they are priced according to the risk. Unless you have some very good reason to use them, they can lead to ruin. This is just another way to say that it is like playing in the casino.

On the other hand, if you have a lot of gains in the stock market, using options may be a small price to keep your piece of mind. Just understand that they give you no clear edge.

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Re:‘A Powerful Signal of Recessions’ Has Wall Street’s Atten... by jedberg on Monday June 25, 2018 @01:25PM (#17394076)
If used correctly, options are like buying an insurance policy. You pay a small amount up front to hedge against large future losses. Hence where the term "hedge fund" comes from.
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