straddles

Traders everywhere are witnessing unraveling equity markets among looming debt concerns. European problems are not restricted to the continent, but are systemic and affect most countries in the world. Investors need to know what to do to protect their holdings in light of global troubles.

One of the easiest ways to hedge your portfolio is to short equities. Let's say you are invested in multiple pharmaceutical companies. In order to protect losses in each individual equity, you could short each of them. However, that would be fairly silly and you might as well sell off the shares owned.