Insure Your Investments And Crash-Proof Your Portfolio
Reduce your Financial Risk
Portfolio Armor helps you hedge your stocks and ETFs by showing you the optimal put options and optimal collars to give you the precise level of protection you want at the lowest cost.
Why Put Options?
Only put options ("puts") protect you against losses from downward jumps in security prices. Puts effectively cap the loss that can be incurred when a security jumps down to a lower price without trading at any of the prices in between.
Collars can reduce the cost of hedging, if you are willing to cap your potential upside. In some cases, collars can eliminate the cost of hedging entirely, or even pay you to hedge (when the income from the call leg exceeds the cost of the put leg, as in the Facebook example above, where the optimal collar has a negative net cost).
How it works:
You enter your stock or ETF position, and the maximum downside risk you are willing to accept for it (your "threshold"). If you are willing to limit your potential upside, you also enter the minimum upside you are willing to accept if your security appreciates significantly (your "cap"). Then, using its proprietary algorithm, Portfolio Armor shows you the optimal puts (if you didn't enter a cap), or the optimal collar (if you did enter a cap) to most economically hedge the position.
Although Portfolio Armor is a very sophisticated tool capable of providing useful calculations it is not designed to replace the advice of a professional investment counselor or your own independent investment research and independent calculations. To rely solely upon the Portfolio Armor tool for investment decisions would be extremely unwise.