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Hedging

1-12 out of 14 results.

Does currency hedging provide an edge?

A growing number of Australians are choosing to hedge their international equity exposures. Currency movements are difficult to predict so investors should treat currency hedging as a way to manage risk, not to add return.

To hedge or not to hedge?

The decision whether to hedge your international equity portfolio can impact your investment over the short and medium term, but an analysis of the data shows that currency impact over the long term is negligible.

Benefits of holding gold in Australian dollars

2022 is another example of gold providing portfolio protection when it’s needed most. Australian investors may be able to magnify the protective benefits by purchasing gold in Australian dollars.  

What drives Australian versus global equity performance?

We tend to think of the 'stockmarket' as one beast, but it pays to know the drivers of the different parts, especially global versus Australian stocks. The outlook favours global due to better sector exposure.

Hide and seek: the FX impact on global equity investments

As more Australians tilt their investments to global equities, they often overlook the exchange rate risk and fees. The move from US57 cents to US73 cents in six months shows the unhedged impact.

Red pill or blue pill? Navigating the matrix of fixed income

Government bond yields are so close to their lower bounds that they are unlikely to provide the returns of the past, nor act as a counter to falling equity markets. What are the investment choices?

Is gold a growth or defensive asset?

As uncertainty intensifies around geopolitics and markets, gold has rallied strongly in 2020. While most investors think of gold for price growth, does it deliver defensive features to a diversified portfolio?

Hedging for capital preservation

New ways to hedge the risks in an equity portfolio are now readily available, including bear funds designed to make money when the market falls. They're not for everyone so check with a financial adviser.

The asymmetric value of gold for Australian investors

An investment in gold without hedging the currency risk of the USD price can deliver portfolio diversification and protection, with the AUD price often rising when equity markets are falling.  

Protecting from downturns using options

The S&P500 experiences a one-month return of -10% or worse only 1.5% of the time. Most drawdowns were much shallower and occur at higher frequencies, but are they worth spending money to protect against?

The other problem with volatility

There are many ways to hedge against volatility, but often at a cost to the overall return of the portfolio. At what point is a smooth journey worth the impact on the destination?

Going defensive: option strategies

Investors who want to limit equity market losses while retaining the upside may use put options. The cost for banks seems relatively low at the moment, but understand what you're doing.

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Australian stocks will crush housing over the next decade, one year on

Last year, I wrote an article suggesting returns from ASX stocks would trample those from housing over the next decade. One year later, this is an update on how that forecast is going and what's changed since.

What to expect from the Australian property market in 2025

The housing market was subdued in 2024, and pessimism abounds as we start the new year. 2025 is likely to be a tale of two halves, with interest rate cuts fuelling a resurgence in buyer demand in the second half of the year.

The perfect portfolio for the next decade

This examines the performance of key asset classes and sub-sectors in 2024 and over longer timeframes, and the lessons that can be drawn for constructing an investment portfolio for the next decade.

Howard Marks warns of market froth

The renowned investor has penned his first investor letter for 2025 and it’s a ripper. He runs through what bubbles are, which ones he’s experienced, and whether today’s markets qualify as the third major bubble of this century.

9 lessons from 2024

Key lessons include expensive stocks can always get more expensive, Bitcoin is our tulip mania, follow the smart money, the young are coming with pitchforks on housing, and the importance of staying invested.

The 20 most popular articles of 2024

Check out the most-read Firstlinks articles from 2024. From '16 ASX stocks to buy and hold forever', to 'The best strategy to build income for life', and 'Where baby boomer wealth will end up', there's something for all.

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