I know zippo about options....I'm a futures trader. But a young friend has a new client who's afraid the market may drop hard in the next few months and he wants some max-leveraged options as protection. He asked me, I told him I wasn't qualified to answer.....but now I'm curious. Here's the assumptions: The money is throwaway.....no drop, expires worthless, no problem. He wants to be continuously covered for 'the drop', taking his first position before week's end. He 'thinks' he should buy 1 month out. His nightmare scenario estimate is an S&P 20% drop (think he said "market" drop). He wants lots of leverage....risks all of it for maximum % reward. He wants index options of some type, not necessarily S&P. What should he buy???? My takeaway is the guy wants cheap options (couple bucks down to ~.40) that he can sell for a huge percentage gain if there is a catastrophic event over the next few months. Personally, I'd be looking at puts on individual stocks as there are a lot that would fall much more than 20% on an S&P drop of that amount......but, they want to do what he wants to do. I'm curious what some of you experienced options traders would suggest. I'm sure there are some type of options "calculators" out there to do this, but I wouldn't know where to look. If the market is down 20% from here on Valentine's day, what strike do you buy?....I don't know?