The markets are being volatile this month and previous month, where the CBOE VIX Volatility Index went way above its usual mark to over 30 points.

That was when portfolios should be having some kind of balance, hedging with some strategies so we can minimize the great pluinge on Long positions. In fact if you manage to pull it off well, protecting the Long side equities positions with some Shorts, minimizing to a lost of 0% or greater, that would make your fund very attractive.

With the CBOE VIX index down to below 30, we see a shift in portfolios. Currently this is my current portfolio:

35% Long-Term Equity (6mth – 1yr)
10% Short-Term Equity (1-3mth)
55% High Yield/growth stocks

In fact I should retain a 10% cash in my portfolio, but instead I went all in to be invested 100%. The 55% of dividend Long positions should cover me some of the loses taken during May where I liquidated some of my positions.

If by mid June the market volatility drops, I am looking at lowering the Yields and Short term term while putting more at the Long terms. Staying at cash is a good idea, for the markets can once again go into volatile and mixed mindset again. That’s when Shorts and Hedging strategies will take place again.

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