How to Protect Your Portfolio Amid Rising Risk

How to Protect Your Portfolio Amid Rising Risk

Assessment

Interactive Video

Business

University

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The video tutorial discusses strategies to protect gains in the S&P, focusing on using options like calls for portfolio protection. It highlights the seasonality of equity markets in November and December and suggests swapping long equity exposure for call options to maintain upside potential while minimizing losses. Additionally, it covers the surge in hedging activities in the high yield ETF market, indicating increased nervousness in credit markets.

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5 questions

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1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is one strategy mentioned for protecting gains in the S&P 500?

Increasing cash reserves

Buying real estate

Using call options

Investing in bonds

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Why might investors consider using call options instead of just puts?

Call options are cheaper

Call options are risk-free

Puts are not available for S&P 500

Call options offer potential upside

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is a potential benefit of swapping long equity exposure for call options?

It increases dividend income

It eliminates all market risks

It provides continued market upside with limited loss

It guarantees profits

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is the ratio of put options to call options in the high yield ETF (HYG) hedging activity?

6 to 1

8 to 1

4 to 1

2 to 1

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What recent market event has started to impact credit markets?

A surge in gold prices

A rise in interest rates

Equity volatility and sell-off

A decrease in oil prices