Queasy feeling, despite the stock market Boom? So you protect yourself before the next crash

From the gloomy mood on the stock exchanges no trace. In just a few weeks have recovered the markets from their lows in March. The Nasdaq is already at a record

Queasy feeling, despite the stock market Boom? So you protect yourself before the next crash

From the gloomy mood on the stock exchanges no trace. In just a few weeks have recovered the markets from their lows in March. The Nasdaq is already at a record high. Is fired, the euphoria by the gigantic bailouts of States and Central banks and the hope that the economy recovers quickly.

The air on the stock exchanges is thin

But can that go well? "The markets have a veritable rally, but the air is thinner," said Dickie Hodges, portfolio Manager at Nomura Asset Management. "In addition, considerable uncertainty about the future of trade relations between the United States and China, is now back in Europe, a dispute over the fiscal and monetary Stimuli, and, not least, the easing of the Corona-restrictions conjures up the risk of a second wave of Infection.“ DAX 12.530,16 PT. -87,83 (-0,70%) Xetra

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in other words: It can threaten at any time there is a setback in the markets. Bad news can send prices plummeting. If one fears that, some of the ways to protect themselves:

investors should now take profits...

This means that investors will sell those shares that you have made in the past months and years, strong gains, and the gains can be realized. "Of profit, no one has become taking still poor," is an old stock market saying.

However, the stock market could rise, contrary to the expectations of some investors, at least in the short term. The could you charge, because you often feel lost profits, worse than real losses. Nevertheless, conservative investors can consider selling at least a portion of their shares, so as to minimize the possible losses. Webinar with Marc Friedrich: How do you now protect your wealth

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... or stop courses set

Who does not want to sell immediately, but only once the further development of the stock market would like to observe, has the option at the time of his securities dealer stop to set rates for his papers. Depending on the personal risk appetite, you should be closer or further away from the current price.

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for example, After the Daimler share price was last climbed up to 41.25 Euro, you could place the stop rates of 10 per cent, including around 37,25 Euro. If in case of a possible price decline in this level should be achieved, will be sold the share at the following rates. As in the case of shares, investors in ETFs may like the Dax, or many of the other papers, stop courses.

For investors who buy bonds want to fall

In the case of a price shock on the stock market, escape to investors usually in the safe haven of US government bonds or German government bonds, causing their prices to go up or the interest rates. After some good U.S. economic data, such as from the labour market had increased the interest rates on ten-year US bonds in the last few weeks, before they have declined somewhat and are currently at 0.8 percent.

In the course of the ten-year bonds from the beginning of June has fallen 193,2 per cent up on 137,2%, before he is then risen to 138,0 percent. Anyone who has a concern about a slide in the stock market, buys, therefore, for example, 10-year US bonds in the expectation that their price is climbing, especially since many experts expect the Fed to follow, contrary to their protestations in the next few months, the "model" of the ECB and also the penalties could be introduced.

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Short ETFs to buy

investors who expect a very imminent price drop for the S&P500 or Dax, can also buy Short ETFs, such as the Xtrackers ShortDAX Daily ETF (WKN: DBX1DS) of the DWS. The ETF reflects on a daily Basis, the inverse performance of the Index. If the DAX rises on a day by 1 percent, decreases the rate of ETFs by 1 percent.

However, the Timing of very great importance in the case of Short ETFs, as the following example clearly shows. Suppose the Dax is rising on the first day to ten per cent, from 10,000 to 11,000 points. The Short ETF is reduced accordingly, by ten percent. The next day, the Dax falls again to 10,000 points – so that he falls to 9.1 percent. The Short ETF increases by the same percentage and reached but only 9.819 points. While the DAX is on the same level as 2 days ago, have owners of the Short ETFs suffered a loss of 1.81 percent.

The bill shows that Short ETFs are in order for a long-term Asset protection, unless it comes to a long-term downturn in the stock market, to avoid the Fed and the ECB, under all circumstances, are likely to try. However, one can speculate with Short ETFs on a short-term stock market decline, it is necessary to observe here, however, the development on the stock exchanges everyday.

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buy Gold

In the case of setbacks in the stock market there are in addition to U.S. state and Federal bonds are usually another safe haven: Gold. In the past few months, the price of the precious metal has received a strong impetus because a lot of countries to combat the Corona pandemic trillion bailout launched the programme, which are financed from the money presses of the Central banks, especially the Fed and the ECB.

investors have the ability to invest in physical Gold, or for short-term speculation in the ETCs, as the French Bank BNP Paribas (ISIN: PS7G0L). The paper is not backed up currency, and has a management fee of 0.99 per cent per year. ECB: First Inflation, then a new monetary order is coming - what the saver is in FOCUS ECB: First Inflation, then a new monetary order is coming - what is the for savers

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Updated Date: 10 June 2020, 20:27

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