Hedge Your Portfolio with ETFs

The stock market has been extremely volatile in August and there are no signs of the volatility moderating in September. In addition to concerns of an interest rate hike, there is a high level of uncertainty regarding the extent of China’s economic decline, potential problems brewing in emerging markets, and ongoing currency devaluations around the world. Stock valuations may also be historically lofty judging by measures like the Cyclically-Adjusted P/E (“CAPE”) ratio. Investors looking to hedge against this volatility and/or the potential for decline may want to consider exchange-traded funds (“ETFs”) as options to offset long stock positions.