In addition to HedgeStreet (below), which is up and running, a usenet thread suggested two articles:
- Ken Harney – New securities product to hedge your house’s value
- and this WaPo article: How to Hedge The Value Of Your Home
Marginal Revolution: Derivatives on housing prices
Macro Securities Research, a company affiliated with Robert J. Shiller, the Yale economist, has reached an agreement with the Chicago Mercantile Exchange to list pairs of derivative instruments that are essentially index funds linked to home prices in certain markets. One instrument in each pair will rise as its market index rises; the other will rise as the same index falls. That will let investors bet on the direction of housing prices. Similar, but less sensitive, vehicles are being offered by HedgeStreet, a firm in San Mateo, Calif., that offers small-scale derivatives speculation online.
I wonder how the accounting will work. I'd rather use my 401K investments to hold these small-investor derivatives.