144: A Simple Bear Market Hedging Strategy

144: A Simple Bear Market Hedging Strategy

📢 Read the full blog post with charts and performance data:

https://www.alphacrunching.com/blog/bear-market-hedging-strategy

Summary:

In this episode of the Stock Market Options Trading Podcast, we break down a bear market hedging strategy that just triggered given the current market conditions.

Right now, SPX is down about 10%—a textbook correction—but it’s also trading below the 200-day moving average, which we’re using as a key reference point for this strategy. While some traders debate whether this qualifies as a bear market, the real focus is on objective, rule-based trading to avoid emotional decisions during volatile times.

We discuss:

How this strategy works – using SPX bear call spreads with a 14-day expiration

Why it only triggers in bearish conditions – avoiding the drag of constant hedging

Performance since 2017 – with a 77% win rate and key takeaways from past bear markets

The importance of avoiding overtrading – staying mechanical when markets turn volatile

This isn’t an everyday trade—it only triggers in bearish conditions—but when it does, it has historically provided an edge in downturns without sacrificing gains in bullish markets.

🎧 Listen now and see if this trade is setting up for next week!

🔗 Full blog post with charts & backtest results: https://www.alphacrunching.com/blog/bear-market-hedging-strategy

Want to connect? Find me on X:

Eric O'Rourke: https://twitter.com/OptionAssassin

After that, join other listeners at https://StockMarketOptionsTrading.net and join the community for free right now where there are daily posts with clues to the where the market may be headed next.

Disclaimer: This podcast is for informational and educational purposes only and should not be considered financial advice.

Jaksot(177)

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