With concerns rising over concentration risk as valuations for many large cap stocks appear too high and companies like SpaceX file for record-setting IPOs, advisors are focused on diversifying their clients’ portfolios.

For clients who invest primarily through ETFs and mutual funds, advisors often turn to a combination of direct indexing, long-short strategies and structured notes to provide downside protection while still seeking to deliver some alpha.

While the S&P 500 has been reaching new highs this summer, the re-escalation of the war in Iran and disappointing earnings reports from some big tech companies serve as reminders that the U.S. market is operating amid extreme volatility. What’s more, after a years-long upwards run and…