In the realm of finance, the term "financial crisis" often conjures images of economic turmoil, market downturns, and widespread panic.
Over the last decade, derivatives—financial products previously accessible only to highly sophisticated institutions such as investment banks and hedge funds—have seen a transformation in accessibility. This change has been propelled by the emergence of retail brokerage platforms, advancements in financial technology, and heightened awareness facilitated by social media. As a result, access to these products has proliferated throughout the industry, reaching a broader range of market participants.
This emergence of complex financial products means that retail traders are no longer destined to fall victim to unscrupulous 'day trading' tactics in pursuit of an edge in the markets. Instead, they can adopt trading approaches once reserved for large institutions.
Angevin Capital fully exploits this evolution of the financial markets to trade sophisticated derivative spreads that can be designed to profit, while also accounting for macroeconomic & market risks. Our trading system is architected to capitalise on tail risk events where traditional investment strategies may falter in times of crisis.
Derivative spreads, a cornerstone of our trading strategy, are structured in such a way as to mitigate risk while maximising potential returns, especially in extreme market conditions. Unlike conventional investments that may suffer significant losses during a financial crisis, our spreads are engineered to withstand and potentially even profit from volatility and market downturns.
But how do derivative spreads work, and why are they particularly well-suited for navigating financial crises? At its core, a derivative spread involves taking positions in multiple derivative contracts with the goal of profiting from the price difference between them or managing risk exposure. This strategy allows us to hedge against adverse market movements while still retaining the potential for significant gains.
By embracing uncertainty and leveraging derivative spreads designed to thrive during exceptional events, we stand ready to navigate through the next financial crisis.