What is a Tail Hedge?
What is a Tail Hedge?
A tail hedge is product or process that protects against a tail event.
What is a tail event?
A tail event is very large and rare event that causes harm in a non linear way.
A tail hedge is product or process that protects against a tail event.
A tail event is very large and rare event that causes harm in a non linear way.
A properly designed tail risk hedge cost effectively mitigates risk. In March of 2020, the US government shut down a small portion of the US economy, when it mandated risk measures to protect against the spread of COVID-19. The predominant sectors that were affected were the travel industry, in order to stop the spread from…
Tiger Global Management, one of the largest and most successful hedge funds over the last decade, is in the news because of severe losses. Chase Coleman is a Tiger Cub, the name given to the protégés of Julian Robertson, the famous macro fund manager from the 1990s. Anyone who says the losses were unpredictable…
Universal Tail Risk
Kids wrestling to the uncle point
Why can’t I get the song “Stuck in the Middle With You” by the band Stealers Wheel out of my head? I wasn’t even around when it was popular, and I don’t enjoy the rest of the band’s music, but it still hums in the back of my mind during the trading day. It has…
The Christmas season brings joy and cheer, A time to enjoy the festive atmosphere, But tail risks lurk in the shadows, So to hedge our bets we must hedge our portfolios, Protected from the jaws of volatility,