In New 60/40 Portfolio, Riskier Hedges Are Displacing U.S. Debt
- Surging demand seen in options to offset stocks at Swan Global
- Currencies are another alternative ‘few are good at’: Toews
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The hunt for new hedges is in full gear.
While much has been made about the search for yield in a world of ultra-low interest rates, valuations in the U.S. Treasury market also leave very little room for price gains to counteract losses should the high-flying stock market turn lower. It’s a dilemma that could reshape the classic investing strategy of 60% stocks and 40% bonds as the Federal Reserve holds rates near zero for the foreseeable future.