But what is hedging all about in the first place?

Conspiracy theorists have their hands in the air. What’s that? Portfolio hedging strategies were created to expand the market for the first generation of derivative products— options and futures contracts. Hmmm, not so far fetched an idea, really. Just back up a bit and think about what they are trying to accomplish.

Hedges are designed to massage your market value numbers, a kind of security blanket that softens the highs and lows of the market cycle. But why focus on the fluff of transient market values in the first place? Cycles eventually correct themselves without the unnecessary drama, guesswork, risk, and trading fees.

It’s not the market value of the portfolio that is of primary importance. It’s the actual content of the portfolio and how you deal with the natural dynamics of the securities you own. Why can’t the media reinforce that kind of stuff instead of the emotion of the month?

If a portfolio has a semi-guaranteed “base income” of 4%, a 4% cushion (or hedge) is always in place, one that grows annually with proper asset allocation management, and adds to the market value in upward cycles— nah, too simple.

For the “rest of the story”:

http://kiawahgolfinvestmentseminars.net/Inv/index.cfm/6979

Steve Selengut

http://www.kiawahgolfinvestmentseminars.com/

http://www.sancoservices.com

Professional Portfolio Management since 1979

Author of: “The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read”

Democratic strategists Wednesday asserted President Barack Obama “has been far more aggressive in fighting al Qaeda” than the previous administration .

In an e-mail this afternoon to supporters — which incidentally excoriated Republicans for politicizing the attempted bombing of Flight 253 — the Democratic Congressional Campaign Committee (DCCC) stressed it was President George W. Bush, not his successor, who relegated the fight against the terrorist network to the back burner by turning “its focus from al Qaeda to Iraq.”

Ultimately, the DCCC’s charge on Wednesday is but a direct response to a new fundraising pitch by Rep. Peter Hoekstra (R-Mich.) — a petition Democrats say exploits the terrorism plot in an attempt to raise campaign dollars.

Hoekstra, who is running for governor in Michigan, asked voters in a letter on Tuesday “who will stand up the Obama/Pelosi efforts to weaken our security” to donate to his gubernatorial war chest.

“It is insulting that The Obama administration would make such a claim, but then again, these are the same weak-kneed liberals who have recently tried to bring Guantanamo Bay terrorists right here to Michigan!” Hoekstra wrote earlier this week.

Of course, that enraged Democrats, and the DCCC quickly pounced on Hoekstra’s remarks, claiming he was “playing politics” at the expense of Americans’ lives. They also fired a separate political shot at congressional Republicans, who the DCCC said “repeatedly [refused] to back up their tough talk with actual votes to keep Americans safe.”

“It just goes to show how extreme and out of touch House Republicans have become that their members would try to score political points and even raise money off the terror plot to blow up a plane and kill innocent Americans on Christmas,” DCCC Chairman Chris Van Hollen (Md.) explained.

“It’s long past time for House Republicans to put country before political party and work with President Obama and Congressional Democrats to learn from this episode and act quickly to protect the American people,” Van Hollen added.