Hedging is really a function of your trading style and of what the market offers you at a specific point in time. I am a swing trader with a trading/investment horizon of several weeks or more. Given that I am generally bullish ( which is not the prevalent "opinion" in this forum currently), from time to time, as a swing trader, I need to hedge my income producing and more speculative long positions with double beta inverse positions in order to preserve the hard earned profits from these long positions on downswings. Generally if and when I calculate the right hedge proportion required to protect and enhance my portfolio I actually generate a nice excess profit on the downswing as well.
Pierre Brodeur