Hedging Against a Market Correction | Charles Schwab A portfolio hedge could be considered effective if the value of the hedged portfolio holds relatively steady in the face of dropping asset prices If we're trying to hedge an equity portfolio against a market sell-off, we'd expect the hedge to be effective if it appreciates in value, offsetting some or all of the drop in equity prices
12 Hedging Strategies and Examples for Your Portfolio Investors often use hedging strategies as protective measures to balance market volatility and stabilize portfolio returns A financial advisor can help you determine which strategies are a good fit for your portfolio