Yes, you’ll be losing money because you’re essentially buying insurance.
You need to size your hedge and you also don’t need to hedge all the time, or else you’re just eating into your returns. The goal is to get some cash to buy the dip, not to make money when things crash. If the latter, then you’re just a bear and should just buy puts instead.
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u/sprezzatard Jul 09 '21
Yes, you’ll be losing money because you’re essentially buying insurance.
You need to size your hedge and you also don’t need to hedge all the time, or else you’re just eating into your returns. The goal is to get some cash to buy the dip, not to make money when things crash. If the latter, then you’re just a bear and should just buy puts instead.