Investors Need to Consider Hedging Event Risk to Avoid Losses, says Expert

Investors should consider hedging event risk by using an expensive strategy like buying an options collar, says Randy Frederick, Managing Director of Trading and Derivatives at Charles Schwab's Center for Financial Research. Frederick says investors who hedged for the recent Brexit would have limited their downside. In terms of the overall market, Frederick thinks consumer discretionary stocks may provide an interesting opportunity in the months ahead. Schwab also has an outperform rating on financials and technology stocks. TheStreet's Rhonda Schaffler has details from Wall Street.