Can CFD's provide an efficient hedge for equity portfolios?

With the decline of confidence in a US recovery SMSF equity portfolios are expected to decline. Can selling OTC index contracts provide an efficient hedge?
There are a number of reasons for a qualified answer. Transaction costs. leveraged exposure to volatility, margin requirements, counter party risk and system risk.
Is there any other insurance like product that provides a similar risk management solution?

Hedge fund risk

Sam Wylie discusses the re-allocation of risk in the forex and interest rate markets on his blog, Core Economics.
How is the risk allocated by insurance?

Hedging your SMSF with Contracts for Difference

I am using CFD's to hedge a SMSF. The transaction costs are low and I can adjust the level of the hedge quickly. This agility to match the hedge with the hedged gives CFD's the edge over traditional insurance.