SSRNDerivatives & Volatility

Tail Risk Hedging in Equity Portfolios: Evaluating the Cost-Effectiveness of Out-of-the-Money Put Options versus Dynamic Tail-Risk Mitigation Strategies During High-Volatility Regimes

Static out-of-the-money put options provide crash protection but drag long-term returns, while dynamic tail-risk strategies adapt to market regimes and deliver superior risk-adjusted returns across cycles.