The buyside is about to get another tool designed to help it hedge portfolios and minimize risk.
Tradelegs, a software company, has included in thier newest deriviatives software release an all-new Portfolio Hedging platform that allows investors and portfolio managers to structure efficient hedges that maximize risk protection while maintaining, and in some cases enhancing, performance.
This release also commences support of options on indices, starting with S&P 500 Index (SPX) options.
Tradelegs analyzes the clients portfolio to identify the preferred hedging instrument that will provide the best tracking to their portfolio. Tradelegs powerful patent-pending technology is then deployed to structure the optimal strategy that meets or exceeds the users hedging criteria while maximizing upside profitability. Clients can subscribe directly to the software or access the technology through a team of expert advisors.
Because options hedging is explicitly linked to an underlier it can provide a more reliable hedge than portfolio diversification, which depends on correlation analysis and does not always provide protection in a major dislocation. Additionally, option hedges can provide asymmetrical payouts that allow you to profit more in favorable movements while protecting against adverse movements.
Tradelegs is in talks with several retail brokers about automating portfolio hedges or Robo-Hedging also.
