>>20665091Because with current rates you can short indices like DAX/CAC/FTSE or S&P with specific CFD-brokers and you earn interest while holding the positions. Interest of not 5% but up to 50%.
Look here for example:
I have a short of the S&P. A 0,25 position, which means I earn 0,25€ per 1 point of the S&P. I receive 0,10€ interest every night. 0,30€ on the weekend.
The margin for that position is:63,89€
Now, you can calculate how much interest that is per day. Mind you, with the cuts the earned interest will decrease. But for you to start paying for your shorts they'd have to cut more than 2,5%.
That would be a way to hedge your long positions. The downside is you have to pay dividends which will be subtracted from your account each day the indices pay dividends. That will lower your earned interest. But you are still hedging.
There are also others with similar rates if not higher. I'm currently searching the web for better brokers with higher interest on the indices (which only is possible cause they have lower costs, the rates are the same (ECB/Fed)
