Here is just a rough idea: Instead of buying portfolio insurance (who ever made money buying insurance on anything?), sell insurance just like all insurance companies do. And you can do this as conservatively as you like. For example you can make 5% in 2020 by selling SPY/SPX put exp December 2020 at 300 strike for about $15/share or more when the market will have a small pullback. Those puts can get quite expensive, maybe $30 if you wait for the right moment, but as you’ve learned waiting doesn’t always work. In any case, this approach would allow you to earn the full profit if SPY ends above $300 by the end of 2020, or if SPY ends up lower then you can get in just like you wanted, and your cost will be only $285/share.
there is no free lunch... you protect then your return will go down. OP your case is common place... stock market participation is still low. right now is fairly safe to jump in, as we are heading for DOW 40000 and SP 5000. keep it simple... buying/ selling insurance is all unnecessary headache you don't need. just increase size gradually... buy enough so that 50% won't affect your sleep. you have 400k, so if you can only take $5k open loss then just buy 10k and put the rest in cash... with experience you will increase your risk tolerance and eventually you can have the entire thing in stocks and no sweat.
Something to consider - find an index that best equates what you view as risk. Buy longer-dated index puts and adjust as the market rises - sell shorter-dated index calls and even if you get a pop the portfolio remains intact. It's a collar with different expirations. Careful about mark to market issues this time of year. Even if a liquid index isn't a perfect match to your portfolio it can still make sense. A lot will depend on the character of your portfolio and how you view risk. Given your playing different parts of the erosion curve - overall cost may be low or close to zero. Collateral may also be an issue. The devil is in the details and a great plus would be dynamic hedging to replicate the put, but you introduce a fair amount of difficulty/complication - depends how much time you're willing to commit and how much you enjoy hedging. Ask yourself one question at the beginning of every week - what's your upside/downside forecast for the next 90 days.
For about 25 years I have owned RVT. It pays a good dividend in good times and bad. They find value where others can not. Also RGT...Same family of companies. You could buy something like GE or Boeing (which have been down greatly)...Do a leap just above what you bought it for...Jan 21. Other boring stock I own...Doesn't mean they are right for you; ENB, BP (you pay an extra tax for being out of country). With ENB they will wave some taxes if you fill out a form with your broker. Others; XOM, ZION, WFC, VZ, T, SLV, SCHW, LOW, BG, ADM, have a large market share and can be optioned. You can do leaps just out of the money. Except for SLV they all pay dividends. You will need to get approval from your broker to trade options (know what you are doing). Another thought, do you own a house or condo (depending on location)? I'm a former Realtor...This idea has been around for years. Find the worst house in the best location, structurally sound. With your spare time, do most of the projects you are capable of doing. Hire GOOD handymen/women, contractors to do the major items. Just my two cents...
I like this guy's idea of buying stocks that pay dividends so you don't feel as much FOMO when you lose. My stable of REITs have gone nowhere for the last 4 months but they have paid out enough in that time frame. So many wonderful ideas. Just write down a plan and follow it. In ten years, you'll have more money than you put in probably.
Your regret is you missed this bull run, now what? The fear is you ended up getting in at the top. Read this: https://www.schwab.com/resource-center/insights/content/does-market-timing-work Your time horizon is more than 20 years, it is more important to be in the market than time the market. Looking back, as long as you invest regularly, timing is not as important as miss participation. Very likely going forward the odds of the same is quite high. Follow the other's suggestions and you should be alright. Good luck.
That might actually be a disadvantage. When you follow something closely and invest time into it, you might start to take outcomes personally as a reflection of ability that could affect your confidence. At some point it turns into a game or competition. I think people who blindly invest passively have an advantage in the sense that they never take investing as a reflection on their own performance or ability. So it might be best to simply allow time to work in your favor and blindly invest in an index fund. But I know how you feel. Pull up finviz.com S&P500 heatmap and select P/E ratio. It's mostly a sea of red. Current S&P 500 P/E is over 25 (https://www.wsj.com/market-data/stocks/peyields) and there's a lot of optimism priced into this market. One solution follow a system. This might work for you although it's not what I do: https://sixfigureinvesting.com/2013/09/modified-davis-method/ Frank is a smart guy and his system seems to have worked well for him. Based on his rules, he limits his risk and posts his entire track record. That's basically what I do. Since I'm very cautious about the upside left in this market, I want to be paid to take risk. I generally sell puts and calls before earnings, and then manage the position by selling more options to hedge risk.
Keep it simple....Trade a single index,and you dont have to invest the full 400k First order of business.. What the max amount of pain you can sleep with?? Can you imagine doubling up down 25% or do you want absolute protection below a certain threshold? What return would you be thrilled with?? Is there a minimum you seek?? 1 year SPY ATM put trades 5.9% of spot.Vol is cheap Div yield is 1.95% Yes,you can trade options to protect a portfolio,but you need to define your comfort zone.. It may be dollar cost averaging,or it may be trading options vs the index..
Might yield higher yield to buy SPY and sell SPY ITM calls at 300 strike -- collect dividend + get more premium in exchange for tying up capital. Sometimes when I have extra capital, I'll buy SPY, sell an ATM call, buy ATM put -- no risk on that position + higher yield on capital than the cash sweep rate.