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Hedging?


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2005 Jun 26, 4:23pm   20,378 views  110 comments

by Peter P   ➕follow (2)   💰tip   ignore  

We may see the introduction of a serious hedging product for homes by the end of this year.

http://www.business2.com/b2/web/articles/0,17863,1026875-3,00.html

Investors will be able to buy a "Macro" to participate in the movement of home prices in a particular area. Effectively, homeowners will be able to hedge the value of their homes against a decline and speculators can also use a similar product to profit from price gains.

On the surface, the emergence of this hedging product will prevent a severe housing crash because homeowners can protect their losses without panic selling. However, prospective buyers can also protect themselves from being "priced-out", which eliminates the need for panic buying.

Peter P

Disclaimer: opinions expressed herein should not be construed as investment advice under any circumstance. Certain investment strategies can be risky and can lead to large losses.

#housing

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107   HARM   2005 Jul 5, 4:40am  

fyi: For those who feel this one's gotten stale, Peter started a fresh thread, "Why", on the underlying causes of the Bubble.

108   Peter P   2005 Jul 5, 1:28pm  

IDEA, what happen to you?

109   Peter P   2005 Jul 5, 2:29pm  

One thing I like about this blog is the mutual respect among its participants. Anger solves nothing. Violence brings more problem. Curses will have no effect on the matter.

110   Peter P   2005 Jul 5, 3:42pm  

Jack, of course I understood your need to use that language. My previous post was directed mostly at Surfer-X. I am worried about him too. I hope that he made up the story about that two guys. It would be pretty bad otherwise.

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