As I recently wrote on OptionMaestro.com, I believe the bank stocks are especially overpriced, but don't really want to sell all of my shares (as this stock market could continue rallying). In this post there are two types of hedging or protective ideas that require the use and knowledge of stock options. To learn more about the risks, pricing, calculations, strategies, and options in general click here.
My major reason for taking a protective stance on the financial stocks is because they have risen the most since the March 2009 stock market bottom (they also fell the furthest in the market massacre - which is one of the reasons I'm taking these option approaches versus selling all of my shares). The Google Finance chart below shows some of the very popular SPDR ETF's and their performance since March 6, 2009 (click image to enlarge).