Hank is right in drawing a distinction between the years up to the mid 90s and the time since then. Though I would say that the key difference between then and now is regulation.
Utilities were heavily regulated, vertically integrated companies. Electric utility companies combined power generation with transmission and distribution. Ma Bell designed its own equipment (Bell Labs) and manufactured it (Western Electric) under the 1956 consent decree.
Under regulation, utility companies were granted monopolies and guaranteed a fair rate of return. They were cash cows, very much like bonds with steady payments.

[Through the early 1990s] most public utilities were regulated monopolies. They were guaranteed a fair rate of return, based on their capital investment and costs. ...
in the old days of regulation, a utility like Con Ed would be required to regularly submit a resource plan to a state's public service commission. The two organizations would forecast demand and decide how much money should be invested in power plants and transmission lines. Rates would be adjusted to cover costs. Under deregulation, however, nobody plays that crucial planning role.

https://www.nytimes.com/2003/08/16/opinion/the-day-the-lights-went-out-an-industry-trapped-by-a-theory.html

Point taken @FD1000. You have said that your timing method isn't for everyone. That is true. And you have said that most should be diversified. But that begs the question, why do you keep posting about your system and trumpeting the great results you have achieved if the majority will lose money with timing. Are you trying to sway them to try when most will lose. Or, are you self-promoting? I have no doubt it works for a small minority. But the majority will never get it right.
Some of your advice is cookie-cutter good. Some, I'm not so sure.

MikeM, please reread my post, I didn't mention or promoted my system.
This site is about all kind of investors. From cookie cutter to advance. From very conservative to all stocks with different goals.
What you or I think is good, others don't agree so much.
2 Easy examples:
1) If you ask Buffet what stocks you should hold, he will say you just the SP500. Ask 100 financial advisers and none will tell you it's correct. Ask posters on this site and none will say, only the SP500.
2) Tell 100 financial advisers that you hold over 40% of your equities in Apple and they will tell you, it's unacceptable. This is what Buffet holds.

I don't know. If there is a bond fund that returned 7.84 over the last 15 years, and 10% over the last three years, like FSUTX has, I'ld like to know the name of it.

Some really good discussion here. A couple comments:
@FD1000,

So, just my opinion, good timing/trading is the only choice IF you can do it.

You are always self promoting this option. Fact is, 90% of every-day investors that try timing methods actually end up with less return over time. That is pretty well documented. Lots of people "think" they can do it, at least initially, but I contend there is a very small minority that actually benefit. I'd be the first to say it hasn't worked for me.
@fred495, @Observant1

...This fund (JHQAX) seems to offer appealing risk/reward characteristics and it's less expensive than many "alt" funds.

JHQAX has successfully proven its mettle over the past 9 years by "providing smoother returns by tempering downside and upside returns via a systematically implemented options strategy".

I'm definitely on the same page as you guys. I don't expect it to make the same return over 10 years as say the S&P 500, but you can say the same for most balanced, allocation or bond funds too. At my age, a smoother contributor in a portfolio with good upside/downside risk stats is valued.

Well, if you read my posts, I said the following hundred of times. Most should own a limited number of funds (mostly in indexes and low ER) based on their risk and goals and hardy trade. Trading is for a small % who can do it with reasonable success. But, the following MAY work for retirees who have enough and don't want to lose much. They don't care about performance, they care a lot more about NOT losing money.
BTW, I never said that JHQAX isn't a good idea. As always the whole portfolio matters more than one fund. Example: suppose someone has 5 funds, each at 20%, he/she can own 20% in JHQAX per their EXPLORE portion.
Basically, there are all kinds of investors, there is no one size fits all. Someone can use one of the following lazy portfolios(link), do nothing for decades and stop reading everything about investing.
This site and other investment sites, in contradiction to the Boglehead, are about thinking about other choices.

Some really good discussion here. A couple comments:
@FD1000,

So, just my opinion, good timing/trading is the only choice IF you can do it.

You are always self promoting this option. Fact is, 90% of every-day investors that try timing methods actually end up with less return over time. That is pretty well documented. Lots of people "think" they can do it, at least initially, but I contend there is a very small minority that actually benefit. I'd be the first to say it hasn't worked for me.
@fred495, @Observant1

...This fund (JHQAX) seems to offer appealing risk/reward characteristics and it's less expensive than many "alt" funds.

JHQAX has successfully proven its mettle over the past 9 years by "providing smoother returns by tempering downside and upside returns via a systematically implemented options strategy".

I'm definitely on the same page as you guys. I don't expect it to make the same return over 10 years as say the S&P 500, but you can say the same for most balanced, allocation or bond funds too. At my age, a smoother contributor in a portfolio with good upside/downside risk stats is valued.

As posted nearby, the AAII Sentiment Bull-Bear spread is at 2.25-yr high.
I am starting to scale my tactical-asset-allocation (TAA) back to normal - for me, 40-60% effective-equity. My TAA had become too high from purchases during 2020-2022.
The idea is hold/buy when Sentiment is VERY negative, sell some when Sentiment is TOO positive.
Personally, no hedging or shorting. Been there, tried that in my working years, but I don't do that now. I do have margin accounts but I don't use margin now.
BTW, low VIX and high SKEW indicate lots of institutional hedging. It's like many institutional bulls are just dancing near the exits. Now, retail investors seem to be joining the party.

AAII Sentiment Survey, 7/19/23
Bullish remained the top sentiment (51.4%; high) & bearish remained the bottom sentiment (21.5%; low); neutral remained the middle sentiment (27.1%; below average); Bull-Bear Spread was +29.9% (high; the highest since 4-8-21). Investor concerns: Inflation (moderating but high); economy; the Fed; dollar; crypto regulations; market volatility (VIX, VXN, MOVE); Russia-Ukraine war (73+ weeks, 2/24/22-now); geopolitical. For the Survey week (Th-Wed), stocks were up, bonds up, oil down, gold up, dollar down. This stock rally continues towards new highs. The Fed will hike rates by +25 bps on Wednesday next week. #AAII #Sentiment #Markets
LINK

"It’s about being able to stay near fully invested - even at an advanced age - and doing better than you would if parked 100% in cash (or cash-like investments)"
You are now going to the other extreme of only cash. There is a lot going on between 0% to 100% stocks. Your goal is to stay invested, my goal is different.
Let's explore several questions
1) How comfortable are you with JHQAX? The following question is the most revealing, what % are you going to invest in JHQAX for the next 20 years? I have more confidence investing in 50/50 PRWCX/VWIAX for many retirees that it meets their goals. In fact, I don't even trust PRWCX, because I don't know how long Giroux will be in charge. This is why my wife has instructions to invest in 3 funds if I'm gone, 2 indexes and VWIAX because I can trust them for decades.
2) You made a good observation, DODBX lost 33% in 2008. But why stop there, stocks+bonds lost over 15% at the bottom of 2022, and many lost over 10% by year-end. In 03/2020, many bond funds lost 10% and stocks over 30% at the bottom. Are you going to get rid of all of them?
3) You made another good point "the various approaches attempted by funds are unpredictable "
Bingo. and why I research it for many years. I talked to many people, especially investors who have enough, and most told me they don't want to ever lose more than 10% from any last top, but they still want their portfolio to make a decent return. They must give up either performance or lower risk.
So, just my opinion, good timing/trading is the only choice IF you can do it. Timing doesn't have to be all or none, you can trade 20-30-50%. BTW, I'm almost sure that Fred was probably in high % in MM for months, just like I did in 2022. When markets don't make sense, I'm out. I don't trust any funds/managers and I don't believe in relative performance, only absolute. If 50/50 PRWCX/VWIAX lost about 10-11% in 2022, it doesn't comfort me compared to -18% for SPY. I don't tolerate this decline.
Another subject we must discuss is how much you have in retirement and let's assume no pension. Smaller portfolios must be at a higher % in stocks to survive. WTF portfolio can be in 20/80 to 80/20. The biggest problem is in the middle.

If there was a “sure” way to make even a penny profit on a trade with 0 risk of loss, people would scale in. (So there isn’t.)
Closest to this I’ve ever achieved was an apparently defective slot machine years ago while visiting a casino with relatives. It actually was consistently paying out a quarter for every 15 or 20 cents cents put in. Played maybe 30 minutes and probably walked away with $3-$4 gain. I’d have stayed longer, but the rest of the group couldn’t see the merit of this exercise and so we moved on.
However, the schemes outlined by Old Joe and msf certainly sound like hedging taken to the extreme.

These may be the first ETFs to wrap this sort of strategy, but vehicles using it have been around "forever". See, e.g. principal protected notes, market linked CDs, indexed annuities, etc.
The particular strategy you described (provide protection via Treasuries, purchase at-the-money call options) is one way of structuring investments. This ETF uses a slightly different strategy (see pp. 19 et seq. in the prospectus).
It purchases at-the-money call and put options and sells an out-of-the-money put option to raise some cash. The put option provides protection against the market declining. The call option purchased provides market exposure for a 100% participation rate. The call option sold creates a cap - if the market goes up higher than the strike price, the buyer of the call will exercise, thus limiting the fund's upside potential.
This variant is independent of interest rates. It should work in ZIRP.
As the Bloomberg piece intimates, a "buffer"ed vehicle does not get 100% protection. (See the principal protected note link above for more on buffers.) So calling this first ETF a "buffer" ETF is somewhat of a misnomer. It does suggest that subsequent ETFs will not have 100% principal protection.

Well said @fred495 -
To me it’s all about doing better than cash over the short-intermediate term (approximately 3 years) with a risk profile you can tolerate. It’s not about beating the market or beating @FD1000 - or beating anyone else. It’s not a game. It’s about being able to stay near fully invested - even at an advanced age - and doing better than you would if parked 100% in cash (or cash-like investments). Why bother? Because inflation is unpredictable. Investing in something beyond “0 risk” cash is one way of hedging against an unknown rate of inflation.
All the criticisms of hedging are true. It does cost more and it does detract from your total return. And the various approaches attempted by funds are unpredictable … You think a balanced fund is more predictable? DODBX fell over 33% in 2008.
My purpose in posting wasn’t to find out whether you can make more money by hedging (You can’t). I just wanted to pick people’s brains about whether they ever engage in the practice and, if so, how they go about it. Thanks to all who offered an opinion.

I've noticed JHQAX (several others mentioned it) a while ago.
This fund seems to offer appealing risk/reward characteristics and it's less expensive than many "alt" funds.

And, JHQAX has successfully proven its mettle over the past 9 years by "providing smoother returns by tempering downside and upside returns via a systematically implemented options strategy".
Of course, it obviously all depends on your personal goals. At this stage of my life, I prefer to err on the side of caution since I don't need a lot more money.
Hence, I prefer to invest in a fund like JHQAX which had a total return of 8.2%, and a modest standard deviation of 8.6%, over the past 5 years. Whereas SPY, for example, gained 12.2%, but had a significantly higher standard deviation of 18.7%.
I find that sleeping well at night is more important to my wellbeing than making a lot of money.
Fred

Buffer Fund
A well-known bit of derivatives magic — a great, simple party trick that derivatives structurers can use to impress their friends — is that if you give me $100 today, I can invest $91 of it in two-year Treasury notes paying 4.75% interest, and in two years I will have $100. And I can invest the other $9 in two-year at-the-money call options on the S&P 500 stock index, options that gain value if the S&P goes up over those two years. Those options cost, let’s say, 13% of the price of the S&P today, so spending $9 on options will get me an option on about $70 worth of the index. And so I can offer you the following trade:
• You give me $100 today.
• In two years, I give you back (1) $100, no matter what, plus (2) 70% of the return on the S&P 500 index, if it’s up.
If stocks go up, you get the gains (well, 70% of them). If stocks go down, you don’t get the losses. What a great trade!
And because I can do this efficiently in size, and because I thought of it and you didn’t, and because I advertised it to you with a cool brochure, I can charge you like 1% of your money for putting this trade together. It is a very good trade, honestly. If you are a sophisticated investor you can quibble with it, but at a simple intuitive level it is just nice. “You get [much of] the upside of stocks, but no downside” is a clean and satisfying pitch. The shape of the payoff graph is pleasing.
Bloomberg’s Vildana Hajric and Emily Graffeo report:

The pioneer of the world’s first “buffer ETFs” — exchange-traded funds that are supposed to limit losses during market selloffs — has launched a new product which it says offers investors complete downside protection.
Investors in the $7.5 trillion ETF universe can now put money behind the Innovator Equity Defined Protection ETF, which began trading under the ticker TJUL on Tuesday. The offering comes from Innovator Capital Management, which launched the first so-called buffer ETFs, also sometimes referred to as defined-outcome funds, in 2018.
Buffer funds, as the name suggests, offer buffered exposure to stocks by limiting investors’ downside risk while also capping upside potential. …
Yet, Innovator says that its TJUL fund — which will track S&P 500 returns up to a capped percentage over a two-year period — will be the first of its kind to protect against 100% of stock losses. TJUL’s cap on potential gains is estimated at about 15% after fees.
Specifically, the fund will invest at least 80% of its net assets in options on the $423 billion SPDR S&P 500 ETF Trust (ticker SPY), according to the fund’s prospectus. TJUL can purchase and sell a combination of call and put options in an effort to cushion against market volatility.
The outcomes set by the fund may only be realized by investors who continuously hold shares of TJUL from the first day of the “outcome period” — July 18 — to the end of the two-year period, which is June 30, 2025, reads the prospectus.

They give you 100% of the gains up to the cap, rather than 70% of uncapped gains, but same basic idea.
There is a reason that this product is the first of its kind: If interest rates are zero, I can’t invest $91 in Treasuries to get back $100, so I don’t have $9 to spend on options to get S&P 500 upside. (I have to put, like, $99 in Treasuries, and the only way to get you any meaningful upside is by giving you some downside risk too.) But as interest rates have gone up, products like this look better, and so people are offering them.
Of course as interest rates have gone up, products like this are in some sense less attractive: Putting up $100 and getting back $100 in two years is worse if I missed out on 4.75% interest than it would be if interest rates were zero. But that’s not the point! The point is that a trade like “I will give you some stock upside and take 75% of the downside between down 5% and down 20% blah blah blah” is annoying and complicated, while “I will give you the upside of stocks and you can’t lose any money” is nice and simple and intuitively attractive. “Buffer fund” is complicated, “stock fund but you can’t lose money” has an obvious appeal.

I have spent years looking for hedging, and shorting funds, starting with AQR. I could not find any consistent fund that can do it. A fund can work for several years and then stop working for other years.
My conclusion is that the only thing that works, especially for retirees who have enough is to go to MM in high-risk markets and back to invest when markets are "normal. Sure, it's called timing. Timing doesn't have to be perfect, just good, just like investing isn't. All you got to do is come up with a system and try, if it does not work then stop.
Here is another point that many miss. Missing the worst days is better than missing the best days.
https://www.barrons.com/articles/timing-the-market-pays-off-buy-and-hold-51588186928
So here’s the full truth, according to data from Ned Davis Research. From 1979 to mid-April of 2020, the S&P 500 Total Return Index gained 11.23% per annum. Sure, if you missed the best 40 days, returns shrunk to 5.21%. How about if you missed the worst 40 days? Nobody ever talks about that, because you’d be accused of market timing. Guess what? Your returns would soar to 18.83% annually. And importantly, if you missed both the best and the worst 40 days, you actually beat the market at 12.39%.
FD: and more importantly, the portfolio risk-adjusted return is much better too.
Read the following
https://www.cambriainvestments.com/wp-content/uploads/2018/01/Where-the-Black-Swans-Hide-the-10-Best-Days-Myth.pdf
Conclusions:
1. The stock market historically has gone up about two-thirds of the time.
2. All of the stock market return occurs when the market is already uptrending.
3. The volatility is much higher when the market is declining.
4. Most of the best and worst days occur when the market is already declining because markets are much riskier than models assuming normal distributions predict.
5. The reason markets are more volatile when declining is because investors use a different part of their brain making money than when losing money.

Here’s a lesson in how not to invest. I’d played around with DraftKings stock (DKNG) for a couple years. “In and out” / “In and out” as it fell from $45 down to under $11. Fortunately, I managed to break even. Not without a lot of effort. Than in January I bought a pretty big slug of it for $11 which was near its all time low. I vowed to hang on. But when it got up to around $14 by month’s end the “chicken” in me took hold and I cashed out for the $3 per share gain. Today, the stock sits near $31. So I’d have nearly tripled my $$ by hanging on 6 more months. If you want to make $$, buy something you believe in that’s badly beaten up and hang on for the long term.
PS - I don’t any longer post specific holdings or buys / sells. Thought the lesson worth sharing.

In 2022 I was one who tried using BLNDX/REMIX, a fund that engages in L/S trading of stock indices, FI, currencies, and commodities. The managers’ monthly reports are quite detailed regarding how their positions fared over the previous 30 days and what new positions have been initiated. The fund measures itself against 50% MSCI World Index and 50% either the BAML 3-Month Index (bonds) or the SG Trend Index and touts itself as an all-weather vehicle. It has only a four-year history. Here are some numbers from the latest monthly missive.
Year to Date 1-Year Since Inception
BLNDX 4.88% 3.05% 12.68%
REMIX 4.82% 2.86% 12.42%
50% MSCI World Index & 50% BAML 3-Month Index 8.85% 11.38% 5.50%
50% MSCI World Index & 50% SG Trend Index 7.78% 9.00% 11.12%
Once all the dust had settled, my sense is that I would have done much better to go to cash other than try to buy an alternative fund to protect my portfolio. IOW, I did not make any money from my positions in REMIX. As someone else pointed out, one would need a sizable position established before the terrible downturn in stocks and bonds in order to have a positive effect. The position would have had to be big and it had to be early. That’s a tough order to fill. I have never tried shorting any asset, so I can’t report on that.

@WABAC: I have hung on to FIW with no regrets. Of the « theme » ETFs I own or have owned, PAVE held up the best during 2022. The ones I sold don’t get mentioned.

PAVE looks like a good one. I'm all booked up on infrastructure with GLIFX. I was able to upgrade to the I share for 45 bucks at Fidelity. The expense ratio is .97 vice 1.22. First dividend paid the fee. It doesn't shoot the lights out. And it has been going through a rough patch lately. But it helps me sleep at night.

”Stay away from it. If possible.”
Yes. Stay away from timing. Agree.
But stay away from considering relative valuations? No. Asset valuations fluctuate over time. To some extent, herd mentality plays a part. None of us has a crystal ball in that regard either. But part of being an investor - professional or retail - is trying to assess relative valuations, be it in large-cap stocks, small-cap, EM or developed global markets.
There was, I think, a lot of “timing” going on in the retail sector in mid ‘22 - a mere 10 months ago. Many unloaded equities due to predictions of approaching recession. Here is an intriguing MFO thread from September, 2022. Pretty typical of the prevailing retail tenor of the day. Where was the buoyant optimism of today back than?
https://www.mutualfundobserver.com/discuss/discussion/comment/153670/#Comment_153670
- One comment: ”I think you have to be worried that it will take five years for stocks to recover.”
- Another: ”Gloomy now, just think how bad it would be if we were in a *recession*”
- Another: ”Ty for the heads up. Not sure what to do now - wait w cash /buy more CDs hoping crisis will pass.”
- And from the excerpted NYT passage: ”Mr. Tangen, of Norway’s sovereign wealth fund, said that he did not think there was an investment area anywhere in the world likely to make money in the near future. ‘That’s the really depressing thing,’ he said.”
The NYT article, which the distinguished @Old_Joe posted at the top of that thread, is dated Sept. 16, 2022. Below is a link to the closing averages for that day. Would you rather buy the S&P back than at 3873 or today at 4555? https://www.coastalwealthmanagement24.com/the-markets-as-of-market-close-friday-september-16-2022/
Despite the air of pessimism running through the thread, a number of posters did see a buying opportunity. @LewisBraham, for one, suggested it might possibly be a good time to buy equities - and made exquisitely good sense as usual. @Junkster mentioned that HY might be a good buy.
Deciding what to own / what to hedge (if anything) relates to assessing relative valuations. I claim no particular acumen in that regard. Just saying, timing aside (don’t do it), there is always the more critical question of relative valuations to consider.

Did I ever tell you the daily prayer of the Wall Street options trader who used to express gratitude to the retail investors trading options while he dropped off his children at private schools on the upper east side costing 65000 a year ?

@hank,
JPM discloses JHQAX hedging strategy in detail on their website. My recollection is the Puts & Calls are against indices, likely S&P 500. It is not a black box fund. You can read on their website and feel free to correct me. (JEPIX - not a subject of this thread writes calls primarily against its position if I recall correctly. The same team manages both.)