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Portfolio Insurance
(redirected from Portfolio Protection)

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Portfolio insurance
A strategy using a leveraged portfolio in the underlying stock to create a synthetic put option. The strategy's goal is to ensure that the value of the portfolio does not fall below a certain level.

Portfolio Insurance
A strategy used to protect against potential losses to a portfolio. For example, one may short sell futures contracts on securities in a portfolio where one makes a profit if the securities decrease in price. Alternatively, one may buy put options allowing one to sell the securities at a predetermined price regardless of market movements. See also: Hedge.

portfolio insurance
The futures or option contracts that serve to offset in whole or in part changes in the value of a portfolio. For example, a portfolio manager might sell short stock-index futures to hedge an expected decline in the market value of a portfolio.


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