Ann: Company Update, page-33

"those with with short positions haven't been able to close their positions for 3 months"

Or they may not want to close them ?? - Did you read your Hot copper email today S/B ?


Hedging Your Portfolio For Volatility

Volatility can be detrimental to your equity portfolio, especially when declines are severe. Reducing your exposure to market downturns through hedging enables you to lock in the value of your equity portfolio and sleep a little better at night.

Because many CFDs can be short-sold, they are an ideal tool for hedging. By holding short CFD positions that mirror your equity holdings, every dollar your equity portfolio loses, your CFD portfolio will potentially gain. For example, a 10% decline in the value of your BHP equities could be offset by a 10% increase in a short BHP CFD position.

You can short individual shares where available or an entire index such as the Australia 200 Cash Index, which can be a much more convenient way to hedge a total portfolio. And because CFDs work on leverage, you can enter a short position with minimal outlay.

Think of it as portfolio insurance. It’s how professional traders help manage
their risk.a