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2021-10-05

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Stock market’s volatile October history means it’s time to steady yourself for a ‘black swan’ event<blockquote>股市十月份的波动历史意味着是时候稳定自己以应对“黑天鹅”事件了</blockquote>

U.S. stocks already are having a rough October — two trading days in. October is the most volatile m

Stock market’s volatile October history means it’s time to steady yourself for a ‘black swan’ event<blockquote>股市十月份的波动历史意味着是时候稳定自己以应对“黑天鹅”事件了</blockquote>

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{"i18n":{"language":"zh_CN"},"data":{"magic":2,"id":820718561,"tweetId":"820718561","gmtCreate":1633432249655,"gmtModify":1633432249806,"author":{"id":4090903292078160,"idStr":"4090903292078160","authorId":4090903292078160,"authorIdStr":"4090903292078160","name":"LHHZ","avatar":"https://static.tigerbbs.com/8f049bd7d3dbb30cc720a7131ea0d0b2","vip":1,"userType":1,"introduction":"","boolIsFan":false,"boolIsHead":false,"crmLevel":11,"crmLevelSwitch":0,"individualDisplayBadges":[],"fanSize":5,"starInvestorFlag":false},"themes":[],"images":[],"coverImages":[],"extraTitle":"","html":"<html><head></head><body>[喷血] </body></html>","htmlText":"<html><head></head><body>[喷血] </body></html>","text":"[喷血]","highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"favoriteSize":0,"link":"https://laohu8.com/post/820718561","repostId":1121989111,"repostType":4,"repost":{"id":"1121989111","kind":"news","pubTimestamp":1633417444,"share":"https://www.laohu8.com/m/news/1121989111?lang=zh_CN&edition=full","pubTime":"2021-10-05 15:04","market":"us","language":"en","title":"Stock market’s volatile October history means it’s time to steady yourself for a ‘black swan’ event<blockquote>股市十月份的波动历史意味着是时候稳定自己以应对“黑天鹅”事件了</blockquote>","url":"https://stock-news.laohu8.com/highlight/detail?id=1121989111","media":"Marketwatch","summary":"U.S. stocks already are having a rough October — two trading days in. October is the most volatile m","content":"U.S. stocks already are having a rough October — two trading days in. October is the most volatile month for stocks — and when stocks suffered their two worst crashes in U.S. market history.<blockquote>美国股市在10月份已经经历了艰难的两个交易日。十月是股市波动最大的月份，也是股市遭受美国市场历史上最严重的两次崩盘的时候。</blockquote> Moreover, there’s a 0.06% chance that the stock market this month will experience a one-day crash as bad as 1987’s Black Monday.<blockquote>此外，本月股市有0.06%的可能性会出现像1987年黑色星期一那样严重的单日崩盘。</blockquote> Those odds don’t seem like much — but they are not zero. The Dow Jones Industrial Average DJIA, -0.94% tumbled 22.6% on Oct. 19, 1987, Black Monday. An equivalent percentage drop from its current level would take more than 7,700 points off the Dow in a single trading day.<blockquote>这些可能性看起来不大，但也不是零。道琼斯工业平均指数道琼斯，-0.94%在1987年10月19日黑色星期一下跌22.6%。从当前水平下跌同等百分比将使道琼斯指数在一个交易日内下跌超过7,700点。</blockquote> Few investors in the market nowadays remember the trauma of Black Monday. Those who do may reassure themselves that a similar crash couldn’t happen today, given market reforms that were instituted in the wake of the selloff.<blockquote>如今市场上很少有投资者记得黑色星期一的创伤。那些这样做的人可能会向自己保证，考虑到抛售后实施的市场改革，今天不会发生类似的崩盘。</blockquote> They are kidding themselves, according to a study conducted by Xavier Gabaix, a professor of economics and finance at Harvard. He and his-coauthors derived a formula that predicts the frequency, over long periods of time, of large daily swings in the market. Upon testing the formula against hundreds of years of stock market returns in both the U.S. and around the world, they found the formula to be impressively accurate.<blockquote>根据哈佛大学经济学和金融学教授Xavier Gabaix进行的一项研究，他们在自欺欺人。他和他的合著者推导出了一个公式，可以预测市场在很长一段时间内每日大幅波动的频率。在根据美国和世界各地数百年的股市回报测试该公式后，他们发现该公式非常准确。</blockquote> For example, Gabaix’s formula predicts that a 22.6% drop in the market will occur every 150 years, on average, over long periods of time. That doesn’t mean such a crash will occur every 150 years, since this predicted frequency is an average over extremely long periods. So the market could experience no such crash over a 150-year period, or experience two of them (or more).<blockquote>例如，Gabaix的公式预测，在很长一段时间内，平均每150年市场将下降22.6%。这并不意味着这样的碰撞每150年就会发生一次，因为这个预测的频率是极长时期的平均值。因此，市场可能在150年内不会经历这样的崩盘，或者经历两次（或更多次）。</blockquote> What you can’t conclude, however, is that the odds of a crash are zero.<blockquote>然而，你不能断定撞车的几率为零。</blockquote> Why market reforms can’t prevent a crash<blockquote>为什么市场改革无法防止崩盘</blockquote> You might object to this conclusion on the grounds that market reforms instituted since 1987 will prevent another crash from occurring — circuit breakers, trading halts and other safeguards. But, as Gabaix has explained to me many times in interviews over the years, such reforms are powerless to prevent a crash. That’s because all markets are dominated by their largest investors, and when many of them want to get out of the market simultaneously, for whatever reason, the market will crash.<blockquote>你可能会反对这一结论，理由是自1987年以来实施的市场改革将防止另一次崩盘发生——熔断、交易暂停和其他保障措施。但是，正如Gabaix多年来在采访中多次向我解释的那样，这种改革无力阻止崩盘。那是因为所有的市场都是由它们最大的投资者主导的，当他们中的许多人同时想要退出市场时，不管出于什么原因，市场就会崩溃。</blockquote> For example, even if trading halts and other restrictions succeed in preventing these large investors from selling on U.S. exchanges, they can still sell on foreign exchanges where many U.S. stocks also trade. They can also sell short with stock index futures contracts or via the purchase of put options. You’re kidding yourself if you think these large investors will be prevented from getting out if they want to.<blockquote>例如，即使交易暂停和其他限制成功地阻止了这些大型投资者在美国交易所出售，他们仍然可以在许多美国股票也交易的外国交易所出售。他们还可以通过股指期货合约或购买看跌期权来卖空。如果你认为这些大投资者想退出就会被阻止，那你就是在自欺欺人。</blockquote> Black swans<blockquote>黑天鹅</blockquote> Gabaix’s research underlines why it’s so important to prepare for so-called black swan events like market crashes that are sudden, awful, unpredictable and rare. Notice that, by this definition, they are unpredictable, so it’s false comfort to believe you can anticipate future black swans in time to reduce your portfolio risk and thereby sidestep a market crash. Did you foresee the COVID-induced bear market in time to avoid big losses?<blockquote>Gabaix的研究强调了为什么为所谓的黑天鹅事件做好准备如此重要，例如突然、可怕、不可预测和罕见的市场崩盘。请注意，根据这个定义，它们是不可预测的，因此相信您可以及时预测未来的黑天鹅以降低投资组合风险从而避免市场崩盘是错误的安慰。您是否及时预见到COVID引发的熊市以避免重大损失？</blockquote> The investment implication is to make changes to your portfolio that will protect you from a crash, if and when it occurs. It’s like buying fire insurance on your house. Most of you will not ever have your houses burn down, but that’s not a reason forego fire insurance. I doubt any of you complain about having to purchase such insurance, since the downside risk of losing everything is sufficiently awful.<blockquote>投资的含义是改变你的投资组合，保护你免受崩盘的影响，如果崩盘发生的话。这就像给你的房子买火灾保险。你们中的大多数人永远不会让自己的房子被烧毁，但这不是放弃火灾保险的理由。我怀疑你们中的任何人会抱怨不得不购买这样的保险，因为失去一切的下行风险已经足够可怕了。</blockquote> What might be the functional equivalent of fire insurance for your stock portfolio? I discussed several different possibilities in acolumn this summer, and I direct your attention to it.<blockquote>对于您的股票投资组合来说，火灾保险的功能等价物是什么？今年夏天，我在专栏中讨论了几种不同的可能性，我希望你能注意到这一点。</blockquote> One possibility is to regularly allocate a small percentage of your portfolio to long-dated, out of the money put options on the S&amp;P 500SPX,-1.30%.In my previous column on this subject, I reported on one such strategy that each year allocated 3.33% to an S&amp;P 500 put option that was 60% out of the money and with two years left before expiration.<blockquote>一种可能性是定期将投资组合的一小部分分配给标准普尔500SPX的长期价外看跌期权，-1.30%。在我之前关于此主题的专栏中，我报道了一种这样的策略，每年分配3.33%的标普500看跌期权是60%价外的，距离到期还有两年。</blockquote> In this particular case, your portfolio’s “fire insurance” carries a premium of 3.33% per year. That doesn’t seem prohibitive, especially since in backtesting back to 2006 this strategy beat the S&amp;P 500 itself. So over this particular period there was no net cost to your insurance. Not bad.<blockquote>在这种特殊情况下，您投资组合的“火灾保险”每年的保费为3.33%。这似乎并不令人望而却步，特别是因为在2006年的回溯测试中，这一策略击败了标普500本身。所以在这段时间里，你的保险没有净成本。还不错。</blockquote> It won’t always work out this well, of course, and this is not the only black swan strategy. But it gives you an idea. The anniversary of the two worst crashes in U.S. market history is an excellent time in which to consider insuring your portfolio against black swans.<blockquote>当然，它不会总是这么好，这也不是唯一的黑天鹅策略。但它给了你一个想法。美国市场历史上两次最严重的崩盘周年纪念日是考虑为您的投资组合提供黑天鹅保险的绝佳时机。</blockquote>","source":"market_watch","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Stock market’s volatile October history means it’s time to steady yourself for a ‘black swan’ event<blockquote>股市十月份的波动历史意味着是时候稳定自己以应对“黑天鹅”事件了</blockquote></title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 12.5px; color: #7E829C; margin: 0;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nStock market’s volatile October history means it’s time to steady yourself for a ‘black swan’ event<blockquote>股市十月份的波动历史意味着是时候稳定自己以应对“黑天鹅”事件了</blockquote>\n</h2>\n<h4 class=\"meta\">\n\nMarketwatch2021-10-05 15:04\n\n</h4>\n</header>\n<article>\nU.S. stocks already are having a rough October — two trading days in. October is the most volatile month for stocks — and when stocks suffered their two worst crashes in U.S. market history.<blockquote>美国股市在10月份已经经历了艰难的两个交易日。十月是股市波动最大的月份，也是股市遭受美国市场历史上最严重的两次崩盘的时候。</blockquote> Moreover, there’s a 0.06% chance that the stock market this month will experience a one-day crash as bad as 1987’s Black Monday.<blockquote>此外，本月股市有0.06%的可能性会出现像1987年黑色星期一那样严重的单日崩盘。</blockquote> Those odds don’t seem like much — but they are not zero. The Dow Jones Industrial Average DJIA, -0.94% tumbled 22.6% on Oct. 19, 1987, Black Monday. An equivalent percentage drop from its current level would take more than 7,700 points off the Dow in a single trading day.<blockquote>这些可能性看起来不大，但也不是零。道琼斯工业平均指数道琼斯，-0.94%在1987年10月19日黑色星期一下跌22.6%。从当前水平下跌同等百分比将使道琼斯指数在一个交易日内下跌超过7,700点。</blockquote> Few investors in the market nowadays remember the trauma of Black Monday. Those who do may reassure themselves that a similar crash couldn’t happen today, given market reforms that were instituted in the wake of the selloff.<blockquote>如今市场上很少有投资者记得黑色星期一的创伤。那些这样做的人可能会向自己保证，考虑到抛售后实施的市场改革，今天不会发生类似的崩盘。</blockquote> They are kidding themselves, according to a study conducted by Xavier Gabaix, a professor of economics and finance at Harvard. He and his-coauthors derived a formula that predicts the frequency, over long periods of time, of large daily swings in the market. Upon testing the formula against hundreds of years of stock market returns in both the U.S. and around the world, they found the formula to be impressively accurate.<blockquote>根据哈佛大学经济学和金融学教授Xavier Gabaix进行的一项研究，他们在自欺欺人。他和他的合著者推导出了一个公式，可以预测市场在很长一段时间内每日大幅波动的频率。在根据美国和世界各地数百年的股市回报测试该公式后，他们发现该公式非常准确。</blockquote> For example, Gabaix’s formula predicts that a 22.6% drop in the market will occur every 150 years, on average, over long periods of time. That doesn’t mean such a crash will occur every 150 years, since this predicted frequency is an average over extremely long periods. So the market could experience no such crash over a 150-year period, or experience two of them (or more).<blockquote>例如，Gabaix的公式预测，在很长一段时间内，平均每150年市场将下降22.6%。这并不意味着这样的碰撞每150年就会发生一次，因为这个预测的频率是极长时期的平均值。因此，市场可能在150年内不会经历这样的崩盘，或者经历两次（或更多次）。</blockquote> What you can’t conclude, however, is that the odds of a crash are zero.<blockquote>然而，你不能断定撞车的几率为零。</blockquote> Why market reforms can’t prevent a crash<blockquote>为什么市场改革无法防止崩盘</blockquote> You might object to this conclusion on the grounds that market reforms instituted since 1987 will prevent another crash from occurring — circuit breakers, trading halts and other safeguards. But, as Gabaix has explained to me many times in interviews over the years, such reforms are powerless to prevent a crash. That’s because all markets are dominated by their largest investors, and when many of them want to get out of the market simultaneously, for whatever reason, the market will crash.<blockquote>你可能会反对这一结论，理由是自1987年以来实施的市场改革将防止另一次崩盘发生——熔断、交易暂停和其他保障措施。但是，正如Gabaix多年来在采访中多次向我解释的那样，这种改革无力阻止崩盘。那是因为所有的市场都是由它们最大的投资者主导的，当他们中的许多人同时想要退出市场时，不管出于什么原因，市场就会崩溃。</blockquote> For example, even if trading halts and other restrictions succeed in preventing these large investors from selling on U.S. exchanges, they can still sell on foreign exchanges where many U.S. stocks also trade. They can also sell short with stock index futures contracts or via the purchase of put options. You’re kidding yourself if you think these large investors will be prevented from getting out if they want to.<blockquote>例如，即使交易暂停和其他限制成功地阻止了这些大型投资者在美国交易所出售，他们仍然可以在许多美国股票也交易的外国交易所出售。他们还可以通过股指期货合约或购买看跌期权来卖空。如果你认为这些大投资者想退出就会被阻止，那你就是在自欺欺人。</blockquote> Black swans<blockquote>黑天鹅</blockquote> Gabaix’s research underlines why it’s so important to prepare for so-called black swan events like market crashes that are sudden, awful, unpredictable and rare. Notice that, by this definition, they are unpredictable, so it’s false comfort to believe you can anticipate future black swans in time to reduce your portfolio risk and thereby sidestep a market crash. Did you foresee the COVID-induced bear market in time to avoid big losses?<blockquote>Gabaix的研究强调了为什么为所谓的黑天鹅事件做好准备如此重要，例如突然、可怕、不可预测和罕见的市场崩盘。请注意，根据这个定义，它们是不可预测的，因此相信您可以及时预测未来的黑天鹅以降低投资组合风险从而避免市场崩盘是错误的安慰。您是否及时预见到COVID引发的熊市以避免重大损失？</blockquote> The investment implication is to make changes to your portfolio that will protect you from a crash, if and when it occurs. It’s like buying fire insurance on your house. Most of you will not ever have your houses burn down, but that’s not a reason forego fire insurance. I doubt any of you complain about having to purchase such insurance, since the downside risk of losing everything is sufficiently awful.<blockquote>投资的含义是改变你的投资组合，保护你免受崩盘的影响，如果崩盘发生的话。这就像给你的房子买火灾保险。你们中的大多数人永远不会让自己的房子被烧毁，但这不是放弃火灾保险的理由。我怀疑你们中的任何人会抱怨不得不购买这样的保险，因为失去一切的下行风险已经足够可怕了。</blockquote> What might be the functional equivalent of fire insurance for your stock portfolio? I discussed several different possibilities in acolumn this summer, and I direct your attention to it.<blockquote>对于您的股票投资组合来说，火灾保险的功能等价物是什么？今年夏天，我在专栏中讨论了几种不同的可能性，我希望你能注意到这一点。</blockquote> One possibility is to regularly allocate a small percentage of your portfolio to long-dated, out of the money put options on the S&amp;P 500SPX,-1.30%.In my previous column on this subject, I reported on one such strategy that each year allocated 3.33% to an S&amp;P 500 put option that was 60% out of the money and with two years left before expiration.<blockquote>一种可能性是定期将投资组合的一小部分分配给标准普尔500SPX的长期价外看跌期权，-1.30%。在我之前关于此主题的专栏中，我报道了一种这样的策略，每年分配3.33%的标普500看跌期权是60%价外的，距离到期还有两年。</blockquote> In this particular case, your portfolio’s “fire insurance” carries a premium of 3.33% per year. That doesn’t seem prohibitive, especially since in backtesting back to 2006 this strategy beat the S&amp;P 500 itself. So over this particular period there was no net cost to your insurance. Not bad.<blockquote>在这种特殊情况下，您投资组合的“火灾保险”每年的保费为3.33%。这似乎并不令人望而却步，特别是因为在2006年的回溯测试中，这一策略击败了标普500本身。所以在这段时间里，你的保险没有净成本。还不错。</blockquote> It won’t always work out this well, of course, and this is not the only black swan strategy. But it gives you an idea. The anniversary of the two worst crashes in U.S. market history is an excellent time in which to consider insuring your portfolio against black swans.<blockquote>当然，它不会总是这么好，这也不是唯一的黑天鹅策略。但它给了你一个想法。美国市场历史上两次最严重的崩盘周年纪念日是考虑为您的投资组合提供黑天鹅保险的绝佳时机。</blockquote>\n<div class=\"bt-text\">\n\n\n 来源：<a href=\"https://www.marketwatch.com/story/stock-markets-volatile-october-history-means-its-time-to-steady-yourself-for-a-black-swan-event-11633366226?siteid=yhoof2\">Marketwatch</a>\n为提升您的阅读体验，我们对本页面进行了排版优化\n\n\n</div>\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{".SPX":"S&P 500 Index",".IXIC":"NASDAQ Composite",".DJI":"道琼斯"},"source_url":"https://www.marketwatch.com/story/stock-markets-volatile-october-history-means-its-time-to-steady-yourself-for-a-black-swan-event-11633366226?siteid=yhoof2","is_english":true,"share_image_url":"https://static.laohu8.com/599a65733b8245fcf7868668ef9ad712","article_id":"1121989111","content_text":"U.S. stocks already are having a rough October — two trading days in. October is the most volatile month for stocks — and when stocks suffered their two worst crashes in U.S. market history.\nMoreover, there’s a 0.06% chance that the stock market this month will experience a one-day crash as bad as 1987’s Black Monday.\nThose odds don’t seem like much — but they are not zero. The Dow Jones Industrial Average DJIA, -0.94% tumbled 22.6% on Oct. 19, 1987, Black Monday. An equivalent percentage drop from its current level would take more than 7,700 points off the Dow in a single trading day.\nFew investors in the market nowadays remember the trauma of Black Monday. Those who do may reassure themselves that a similar crash couldn’t happen today, given market reforms that were instituted in the wake of the selloff.\nThey are kidding themselves, according to a study conducted by Xavier Gabaix, a professor of economics and finance at Harvard. He and his-coauthors derived a formula that predicts the frequency, over long periods of time, of large daily swings in the market. Upon testing the formula against hundreds of years of stock market returns in both the U.S. and around the world, they found the formula to be impressively accurate.\nFor example, Gabaix’s formula predicts that a 22.6% drop in the market will occur every 150 years, on average, over long periods of time. That doesn’t mean such a crash will occur every 150 years, since this predicted frequency is an average over extremely long periods. So the market could experience no such crash over a 150-year period, or experience two of them (or more).\nWhat you can’t conclude, however, is that the odds of a crash are zero.\nWhy market reforms can’t prevent a crash\nYou might object to this conclusion on the grounds that market reforms instituted since 1987 will prevent another crash from occurring — circuit breakers, trading halts and other safeguards. But, as Gabaix has explained to me many times in interviews over the years, such reforms are powerless to prevent a crash. That’s because all markets are dominated by their largest investors, and when many of them want to get out of the market simultaneously, for whatever reason, the market will crash.\nFor example, even if trading halts and other restrictions succeed in preventing these large investors from selling on U.S. exchanges, they can still sell on foreign exchanges where many U.S. stocks also trade. They can also sell short with stock index futures contracts or via the purchase of put options. You’re kidding yourself if you think these large investors will be prevented from getting out if they want to.\nBlack swans\nGabaix’s research underlines why it’s so important to prepare for so-called black swan events like market crashes that are sudden, awful, unpredictable and rare. Notice that, by this definition, they are unpredictable, so it’s false comfort to believe you can anticipate future black swans in time to reduce your portfolio risk and thereby sidestep a market crash. Did you foresee the COVID-induced bear market in time to avoid big losses?\nThe investment implication is to make changes to your portfolio that will protect you from a crash, if and when it occurs. It’s like buying fire insurance on your house. Most of you will not ever have your houses burn down, but that’s not a reason forego fire insurance. I doubt any of you complain about having to purchase such insurance, since the downside risk of losing everything is sufficiently awful.\nWhat might be the functional equivalent of fire insurance for your stock portfolio? I discussed several different possibilities in acolumn this summer, and I direct your attention to it.\nOne possibility is to regularly allocate a small percentage of your portfolio to long-dated, out of the money put options on the S&P 500SPX,-1.30%.In my previous column on this subject, I reported on one such strategy that each year allocated 3.33% to an S&P 500 put option that was 60% out of the money and with two years left before expiration.\nIn this particular case, your portfolio’s “fire insurance” carries a premium of 3.33% per year. That doesn’t seem prohibitive, especially since in backtesting back to 2006 this strategy beat the S&P 500 itself. So over this particular period there was no net cost to your insurance. Not bad.\nIt won’t always work out this well, of course, and this is not the only black swan strategy. But it gives you an idea. The anniversary of the two worst crashes in U.S. market history is an excellent time in which to consider insuring your portfolio against black swans.","news_type":1,"symbols_score_info":{".SPX":0.9,".IXIC":0.9,".DJI":0.9}},"isVote":1,"tweetType":1,"viewCount":2455,"commentLimit":10,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"symbols":[],"verified":2,"subType":0,"readableState":1,"langContent":"CN","currentLanguage":"CN","warmUpFlag":false,"orderFlag":false,"shareable":true,"causeOfNotShareable":"","featuresForAnalytics":[],"commentAndTweetFlag":false,"andRepostAutoSelectedFlag":false,"upFlag":false,"length":6,"xxTargetLangEnum":"ZH_CN"},"commentList":[],"hasMoreComment":false,"orderType":2}