Warren Hammond's Personal View: Fragile highs
'The March-June 2025 period will bring extreme market volatility, driven by geopolitical conflicts, economic instability, and shifting power dynamics. Immediate shocks are severe, while long-term consequences shape financial markets, trade flows, and capital allocation into 2028.'
That foresight was swiftly validated. By April, global markets were reeling: the VIX surged, geopolitics flared, and equities sold off aggressively as investor confidence faltered. A rearmament cycle is driving global defence spending higher
Middle East instability, energy insecurity, and oil supply disruption; warning of Iran-Israel and Ukraine-Russia conflict
The rise of cyberattacks and surveillance infrastructure as dominant investment themes
A reiteration to accumulate gold, first recommended on 8 March 2021
Now, markets are near record highs, but complacency is visible, momentum is fading, and liquidity is thinning. July is fragile. The next wave of volatility is nearing. Headline-driven shocks from geopolitical, regulatory, or domestic unrest
Potential for flash crashes or algorithmic dislocations
Cyberattacks or infrastructure disruptions that unsettle sentiment
A breakdown in leadership or sentiment sparking fear-based trading
Overstretched valuations lacking support
It's time to rebuild protection, reduce fragility, and prepare for downside risk.
Downside Protection: Portfolio Insurance on the S&P 500
For global investors with equity exposure, especially those fully allocated, now is the time to consider derivative trades to hedge a sharp S&P 500 drawdown.
Put Spread Collar
Buy a near-the-money put, sell a deeper one, and finance with an OTM call. A low-cost way to insure downside while capping upside.
Zero-Cost Put Spread
Buy a 3-5% OTM put and sell a 7-10% OTM put for limited-cost protection against moderate declines.
VIX Call Options
Purchasing near-term VIX calls (2-4 weeks out) helps hedge tail risk, as volatility typically spikes during equity stress.
SPX Ratio Put Spread
Buy one ATM put and sell two or more deeper OTM puts. Lower cost, but introduces risk below a second threshold, is useful in deep sell-offs.
These can be tailored to other global indices (Euro Stoxx 50, FTSE 100, Nikkei, JSE Top 40, etc.) correlated with U.S. equity direction.
Conclusion:
The market may look strong on the surface, but it's skating on thin ice.
July is tactically vulnerable. Volatility returns when least expected. Now is the time to position defensively, protect gains, and prepare for a sharp risk repricing.
Have you started adjusting your investment strategy in anticipation of renewed volatility? Share your thoughts, questions, or alternative strategies in the comments below.
Let us know by leaving a comment below, or send a WhatsApp to 060 011 021 1
Subscribe to The South African website's newsletters and follow us on WhatsApp, Facebook, X and Bluesky for the latest news.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The South African
7 hours ago
- The South African
Uber drivers shut down South Africa's biggest city amid fare dispute
Uber users in Johannesburg are being urged to make alternative travel arrangements as Uber drivers plan a protest over ongoing disputes related to fare pricing and commission deductions. According to organisers, hundreds of Uber drivers are expected to gather in Kramerville on Tuesday and then march to Uber's headquarters in Parktown to deliver a list of grievances. Driver representative Awelani Mashete says the protest is aimed squarely at one issue: unprofitable pricing. 'We are not fighting for many things,' Mashete said. 'We are only fighting for a price. We will continue with the strike until our demands are met.' Drivers have expressed frustration over what they describe as diminishing earnings due to recent changes in commission structures and base fare rates, claiming they are often operating at a loss. The planned strike may significantly disrupt e-hailing services in Johannesburg, potentially leading to delays, higher prices due to demand, and limited availability of drivers throughout the city. No formal response has yet been issued by Uber South Africa regarding the protest. The situation remains fluid, and further updates are expected as the protest unfolds. Let us know by leaving a comment below, or send a WhatsApp to 060 011 021 1 Subscribe to The South African website's newsletters and follow us on WhatsApp, Facebook, X and Bluesky for the latest news.
The South African
12 hours ago
- The South African
Home Affairs has great news for South Africans living in Australia
South Africa's Department of Home Affairs has launched two new dedicated service centres in Sydney and Melbourne to assist South Africans living in Australia with Smart ID and passport applications. The move is part of the department's Home Affairs @ Home initiative, designed to reduce turnaround times for critical identity documents from over a year to just five weeks . Speaking about the expansion, Minister Leon Schreiber said the launch follows a successful trial in the United Kingdom and is aimed at eliminating long delays that have left many overseas South Africans frustrated. Sydney : 16 July 2025 at 10:00 (AEST) 📍 Level 6, 88 Pitt Street, Sydney, NSW 2000 : 📍 Level 6, 88 Pitt Street, Sydney, NSW 2000 Melbourne: 18 July 2025 at 13:00 (AEST) 📍 Level 5, 332 St Kilda Road, Melbourne, VIC 3004 Australia is home to over 210 000 South African expats, making it the second-largest community outside of South Africa, after the United Kingdom. The department also confirmed further rollouts in New Zealand and the UAE, followed by France, Germany, and the Netherlands later in 2025, and North America in 2026. This is part of the department's broader push to phase out the green barcoded ID book and transition all citizens to the more secure Smart ID card by 2029. The expansion also aligns with Home Affairs' plan to enable Smart ID and passport services at over 100 bank branches by year-end – with a goal of reaching 1 000 branches by 2028. Let us know by leaving a comment below, or send a WhatsApp to 060 011 021 1 Subscribe to The South African website's newsletters and follow us on WhatsApp, Facebook, X and Bluesky for the latest news.
The South African
14 hours ago
- The South African
Here's the mid-month petrol and diesel price projection for August
The mid-month petrol and diesel price projections show there's likely to be mixed news at the pumps in early August for South Africa's motorists. Petrol is set to drop in price, while the diesel price will hit motorists harder in the pocket should market conditions remain the same for the next three weeks. Below, the latest projections as received by The South African website from the Central Energy Fund (CEF), effective Monday, 14 July. FUEL PRICE CHANGE Petrol 93 decrease of 24 cents Petrol 95 decrease of 20 cents Diesel 0.05% increase of 63 cents Diesel 0.005% increase of 62 cents Illuminating Paraffin increase of 26 cents If the market conditions were to remain consistent for the remainder of the month – an unlikely scenario with the rand/dollar exchange rate fluctuating and the oil price ever changing – a decrease of 24 cents is expected for petrol 93 octane motorists and a decrease of 20 cents for 95 users. Meanwhile, diesel motorists would see something between a 62 and 63 cents per litre increase. Finally, illuminating paraffin is expected to rise by 26 cents in price. FUEL PRICE IN SOUTH AFRICA IMPACTED BY TWO MAIN FACTORS: 1. The international price of petroleum products, driven mainly by oil prices 2. The rand/dollar exchange rate used in the purchase of these products Oil price At the time of publishing the brent crude oil price is $68.78 a barrel. Exchange rate At the time of publishing the rand/dollar exchange rate is R17.83/$. The final overall price changes for both petrol and diesel will be confirmed early next month with the new prices taking effect at midnight on Tuesday, 5 August 2025. Go easy on the accelerator until then, Mzansi. INLAND July Petrol 93 R21.79 Petrol 95 R21.87 Diesel 0.05% R19.35 Diesel 0.005% R19.41 Illuminating Paraffin R13.16 COASTAL July Petrol 93 R21.00 Petrol 95 R21.04 Diesel 0.05% R18.52 Diesel 0.005% R18.65 Illuminating Paraffin R12.14 Let us know by leaving a comment below, or send a WhatsApp to 060 011 021 1 Subscribe to The South African website's newsletters and follow us on WhatsApp, Facebook, X and Bluesky for the latest news.
