GO
Loading...

Don't Be A Big Loser, Get Correction Protection!

Thursday, 21 May 2009 | 6:11 PM ET

Were you caught off guard by the recent wave of selling that swept across Wall Street? Did it leave you with unexpected losses? It might be time for some correction protection.

It seems talk of a correction seems to be picking up steam.

Only one day ago TD Securities strategist Stephen Koukoulas told CNBC.com, “our hunch is that the stock market will have a significant pullback in the next six months.”

Investment strategist Subodh Kumar told us he expects a 10 to 15 percent correction in the nearer term. And on Fast Money, the founder of hedge fund T2 Partners Whitney Tilson revealed a substantial number of short positions based on a similar belief. Considering Thursday's market action all these guys may be onto something.

If we're about to embark on the next leg lower, how should you protect yourself?

Pete Najarian

If you’re in a stock, make sure to also buy puts for protection.

Gold in a portfolio is classified as an alternative investment and I like it as protection. Or put on a pairs trade. For example sell regional banks and buy capital banks against it.

Tim Seymour

I’d buy puts in the IWM for protection on the downside. And I also like gold as a hedge.

Steve Grasso

Profiting From a Correction
How investors can protect themselves and profit, with the Fast Money team.

I’d get longWal-Mart, Target or Kohl’s . I think they benefit from an increased need to shop economically.



______________________________________________________
Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment but not have it published on our website send your e-mail to fastmoney@cnbc.com.

Trader disclosure: On May 21st, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Najarian Owns (APC) Call Spread; Najarian Owns (BX) Calls; Najarian Owns (INTC) Calls; Najarian Owns (ISIS); Najarian Owns (MOS) Call Spread; Najarian OWns (XHB) Call Spread; Najarian Owns (XLB) Call Spread; Najarian Owns (XLU) Call Spread; Najarian Owns (BP) Call Spread; Terranova Owns (GENZ), (ABI), (JOYG), (XBI), (TER); Terranova Owns Oil Futures; Terranova Owns Nat Gas Futures; Terranova Owns (DIS) Calls; (XOM) Calls; Terranova Owns June Gold Futures; Grasso Owns (NYX), (XLF), (RIMM), (V); Grassso's Clients Owns (PETM); Grasso's Firm Owns (WMT); Grasso's Client Owns (SUN); Grasso Owns (NYX); Seymour Owns (AAPL), (BBT), (BX), (EEM), (FLR), (TTM), (INFY), (MGM), (PBR); Seymour is Short (FCX), (POT)

  Price   Change %Change
IEV
---
KSS
---
TGT
---
WMT
---

Featured

Contact Fast Money

  • Showtimes

    Halftime Report - Weekdays 12p ET
    Fast Money - Weekdays 5p ET
  • Melissa Lee is the host of CNBC's “Fast Money” and “Options Action.”

  • Scott Wapner is host of the "Fast Money Halftime Report," which airs weekdays from 12 p.m. to 1 p.m. ET.

  • Guy Adami is a contributor on CNBC's "Fast Money." He also is managing director of stockMONSTER.com.

  • Najarian, the "Pit Boss," is cofounder of optionMONSTER.com, a news site for options traders.

  • Finerman is president of Metropolitan Capital Advisors, Inc., a company she co-founded.

  • Founder of EmergingMoney.com

  • Chief Market Strategist for Virtus Investment Partners & CNBC Contributor

Halftime Report