WILL WE SEE A NEW DECADE OF WARS AND ECONOMIC TURMOIL?

"When goods are not allowed to cross borders, armies will." - Frédéric Bastiat

# WHAT DOES BASTIAT MEAN?

During times like those we have today, where the economy has huge problems, we often see wars breaking out. This especially goes for times of high electricity prices and higher unemployment, which we could see if we get deeper into a recession. Therefore, it might be a good idea to hedge your portfolio against those risks to not be affected by it, but how can you do this? Most hedges are applied by shorting or going long on inverse etfs. If you are not familiar with shorting futures or stocks that's no problem since you can just copy someone who can. Therefore, we want to introduce you to our portfolio today.

* A PORTFOLIO WITH A LOT OF UPSIDE POTENTIAL AND MUCH LESS DOWNSIDE THAN THE MARKET!

The base idea of our portfolio is pretty simple. We search for good stocks that have either growth potential or are undervalued to buy them. At the same time, we look for unprofitable, overvalued and companies with a lot of debt and nearly no growth potential to short them. Therefore, we can still make the same profits as a normal long only portfolio, since good stocks rise in a normal market while bad ones fall, leaving us with a good profit. The portfolios upside to the long only portfolio however lies in the situations when the market falls.

During those times, all stocks do normally fall, since their future cash flow projections get more and more unlikely. For us, this does not mean that we make losses in every position, since we have short positions. Therefore our portfolio was able to only lose 4.5% during the 20% market fall down and is now down less than 2% ytd, while $NSDQ100 $SPX500 and $DJ30 are all down more than 20% ytd.

Trade safely.