Top 5 Strategies to Hedge Against S&P 500 Declines

The article lays out five approaches investors often consider to hedge against declines in the S&P 500, framing volatility as a key risk factor for portfolio value. It first describes buying VIX call options tied to the CBOE, noting that VIX tends to rise with implied volatility and that timing matters—purchasing in the middle of major crashes can lead to large losses. It also discusses VXX, the iPath S&P 500 VIX ST Futures ETN, while warning about performance quirks because it tracks VIX futures rather than the index. A second strategy covers shorting the S&P 500 through ETFs, futures, or inverse funds, and buying put options, while highlighting that put premiums typically rise during selloffs due to higher volatility. The remaining strategies are not included in the excerpt provided.