How to crashproof your portfolio

As we approach the anniversary of Black Tuesday, Oct. 29, when in 1929 stock markets around the world crashed in unison, marking the onset of the Great Depression, you might want to think about how you’re going to hold onto your investment gains over the bull market of the past eight years when a new downturn strikes—as it inevitably will. In this interview with the Moneysense website, Nassim Nicholas Taleb, a former Wall Street trader and author of the bestsellers The Black Swan and Antifragile, offers six steps to make your mix of investments more likely to withstand the markets’ vicissitudes. A couple are obvious—diversify your holdings and hold cash in reserve—but some others are not, including certain hallmarks of firms that are most likely to survive a downturn. It all requires homework, of course. If you’re not prepared to do it, use an adviser or invest in a diversified basket of low-cost index funds (or, if you’re really scared, deposit-insured GICs).