>A few puts on SPY dated a year or two out?

You think the hedge funds selling SPY options don't have this priced in already? Of course, you can still make money on this bet, just like you can win money at a roulette table, but unless you think have some special insight that hedge/quant funds don't have, buying options should be negative EV.

The ask was not how to make money, it was how to hedge.

I’d argue that it is very normal for hedging to be giving up expected value in return for a reduction in volatility of returns.

If you have a lot of exposure to the market already one could say not buying the option is more akin to roulette.

> but unless you think have some special insight that hedge/quant funds don't have

Of course not, but it is a hedge, is it not? What would be your preferred hedge in this scenario?

agree, mostly true. always better to find a credit spread for your desired exposure