KKLEE
07-23

After a relentless rally, tech stocks are finally showing signs of fatigue. With profit-taking, rising geopolitical risks, and macro jitters creeping in, the selloff in high-growth names has left many wondering: Is this the start of a deeper correction — and how do you hedge now?

Option 1: Buy the VIX

The VIX — often called the “fear index” — typically spikes when markets drop. If volatility picks up, buying VIX-related ETFs or calls can provide upside when markets go risk-off. It’s a relatively straightforward hedge when you expect broad-based panic or rapid moves.

Pros: Simple exposure to volatility, works well in sudden market drops.

Cons: Timing is tricky. VIX spikes are often short-lived and can decay fast.

Option 2: Buy Puts

Buying put options directly on tech ETFs (like QQQ) or individual stocks gives you more targeted protection. You can control your downside without needing to sell your long positions.

Pros: Direct protection on your holdings, customizable strike and expiry.

Cons: Requires premium payment, and puts can expire worthless if market doesn’t fall enough.

Which Should You Choose?

If you want a broad market hedge, VIX-linked strategies might work better. But if you're specifically protecting your tech-heavy portfolio, puts on QQQ or key names like Nvidia, Apple, or Tesla could be the smarter play.

In volatile markets, defense is just as important as offense. The question isn’t whether to hedge — it’s how fast you act before the next leg down.

SeptemBEAR is here: Are Your Portfolio Ready for Volatility?
In September, the VIX may fly as we may see September Effect hit again. ------- 1. Is the market in danger with September effect approaching? 2. What's your strategy to cope with risks?
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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