Managing Market Risk through Options Hedging

John is the Chief Investment Officer at a large investment firm managing a diversified portfolio of equities and fixed-income securities. The firm has recently faced increased volatility in the equity markets due to geopolitical tensions, leading to a significant decline in the value of their equity positions. John is considering a strategy to mitigate the risks associated with these market fluctuations while maintaining exposure to potential upside returns. He is evaluating three different risk management strategies to protect the portfolio from further market downturns.

Which of the following strategies would be the most effective for John to manage the market risk in his equity portfolio while allowing for upside potential?