How to Invest in Struggling Retailers

For those investors looking at some of the biggest names in retail such as Best Buy , Radio Shack and J.C. Penney and watching these ailing companies struggle to find the right ingredients for a turnaround, Motley Fool analyst Blake Bos has some advice. He talks about how it might be a good idea to hedge your risk by buying a basket of stocks rather than one, and by making this a small rather than a large part of your portfolio, as retail is a very volatile sector right now. He also suggests buying protective puts or selling covered calls on these stocks as ways to mitigate some risk or increase your returns, but warns that using an options-based approach is something you should understand fully before you pursue it.

Many have written off any chances for RadioShack's revival, but the brand has been around for more than 80 years and survived numerous technological disruptions during that time. The question is: Can RadioShack survive in today's new retail environment? To help answer that question, we've compiled an in-depth premium report covering all the opportunities, risks, and specific issues that every investor should be aware of before deciding whether RadioShack is a buy or a sell. Simply click here now to claim your copy and start reading today.

The article How to Invest in Struggling Retailers originally appeared on Fool.com.

Blake Bos owns shares of RadioShack. Isaac Pino has no positions in the stocks mentioned above. The Motley Fool owns shares of Amazon.com and Best Buy and is short RadioShack. Motley Fool newsletter services recommend Amazon.com and Best Buy. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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