The simplest solution would be to just buy a put on one of the various stock index futures. Let's look at the most popular stock index, the Standard & Poor's 500 Index. The September S&Ps are currently (July 2) trading at 1968.00. On this date, the September 1900 put is trading at $19.50, a real value worth $975.00. This should afford you the right to be short the S&Ps at 1900.00 at a cost of $950.00 plus commissions. Should the market trade below 1880.50 (1900.00 minus the 19.50 premium paid for the option) before the expiration on Sept. 19, you should make a profit equivalent to the amount of the difference between the futures price and the strike price minus the premium paid.
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