We’re all seeing the same thing, I promise you. You may be asking yourself a scary question: are we due for a correction or a stock market dip?

The answer is, it doesn’t matter. You can’t predict the future, and neither can I. What I can tell you is that we’re currently in a bull market and you need to be capitalizing on opportunities like this as they present themselves.

Is the market frothy, with a proximity to all-time highs that are somewhat disturbing? Yes.

So what do you do?

Well, you can do what I’m doing, which is to mitigate risk by using less of your capital to make bullish plays. That way, you can continue to profit at the market’s seeming irrationality and exuberance while covering yourself on the downside risk. Remember: you can’t afford to miss bull runs like this!

Hedging your risk by using less capital

Rather than spending $12,000 to buy 100 shares of NVDA, you could consider buying calls or puts. To use even less capital, you could consider call debit spreads or put credit spreads.

Here are my current thoughts on NVDA, which are similar to my thoughts on other frothy tech & growth stocks.