This is the Hacker News community. Let's be constructive and civil. Your comment would have more interesting and relevant if you had explained why this trading strategy is a bad idea instead of just labeling it as "idiotic".
* In deferrence to Boglehead philosophy, hedging bets is a fool's errand because the idea is you lose your money the more you touch it. Make a plan, invest, and then hold hold hold staying the course come hell or high water.
* If you truly want to reduce or eliminate risk, the best way is to simply cash out. A $1 bill will always be a $1 bill with absolute certainty.
As a boglehead... that's just not how it works in the real world. Some people would treat the loss of $X worse than the gain of $X is good. Thus, they don't have linear value for money (no one really does... if you lose 90% of your bank account, you still have dinner tonight; if you lose all of it, you might not).
Some people want to come out neutral or lose a guaranteed small amount, rather than the chance to lose or gain the same amount. I'd pay $5 to avoid having to flip a $10k +/- coin. Thus, if I knew I would lose $10k if X got elected, I could place a $10k bet for Y to win.
> In deferrence to Boglehead philosophy, hedging bets is a fool's errand
The flagged comment didn't say that hedging was idiotic, but implied that the specific hedge mentioned was idiotic, yet didn't give any reason for calling it such.
>$1 bill will always be a $1 bill with absolute certainty
Dalewyn|1 year ago
* In deferrence to Boglehead philosophy, hedging bets is a fool's errand because the idea is you lose your money the more you touch it. Make a plan, invest, and then hold hold hold staying the course come hell or high water.
* If you truly want to reduce or eliminate risk, the best way is to simply cash out. A $1 bill will always be a $1 bill with absolute certainty.
sodality2|1 year ago
Some people want to come out neutral or lose a guaranteed small amount, rather than the chance to lose or gain the same amount. I'd pay $5 to avoid having to flip a $10k +/- coin. Thus, if I knew I would lose $10k if X got elected, I could place a $10k bet for Y to win.
s1artibartfast|1 year ago
It is commonplace to take various financial positions that limit downside. It is one of the primary uses of options and futures.
TeaBrain|1 year ago
> In deferrence to Boglehead philosophy, hedging bets is a fool's errand
The flagged comment didn't say that hedging was idiotic, but implied that the specific hedge mentioned was idiotic, yet didn't give any reason for calling it such.
>$1 bill will always be a $1 bill with absolute certainty
This is money illusion.