After a seven year bull run and an increased uncertainty, people may expect the equities market will more likely pullback and give up some of its gains. Consequently, traders have turned to bearish or inverse exchange traded fund strategies to hedge against turns in a more volatile market.
On an upcoming webcast this Wednesday, Sector Strategies in a Post Brexit World, Tom Dorsey, Co-Founder of Dorsey, Wright & Associates, and Sylvia Jablonski, Managing Director and Head of the Capital Markets & Institutional Strategy Team at Direxion, will discuss hedging strategies to manage a rougher road ahead.
According to Jefferson National’s second annual Advisory Authority Survey, financial advisors see ongoing volatility as one of the top macro issues that will adversely affect client portfolios over the next year, ThinkAdvisor reports.
Related: VIX, Bearish S&P 500 ETFs to Hedge Uncertainty
Specifically, 76% of RIAs and fee-based advisors, 89% of the highest earning advisors and 63% of investors in the survey expected volatility to rise in the coming year as both U.S. politics and domestic and international economics exacerbate the uncertain outlook. Among the top concerns, those surveyed pointed to energy prices, Federal Reserve policy, U.S. presidential election and Chinese instability.
“When it comes to investing, protecting clients’ portfolios and protecting their own practice, ongoing volatility remains the number one concern of RIAs and fee-based advisors year over year — while investors are aware of volatility’s impact, they say that protecting assets is their number-one concern,” Jefferson National president Laurence Greenberg said in a statement.