The two main ways are **short selling the stock** and **buying put options**.

**1. Short selling**

You borrow shares through your broker, sell them now, then buy them back later to return them.

For example:

- You short 100 shares at $50, receiving $5,000.
- Next week, the price falls to $40.
- You buy back the 100 shares for $4,000 and return them.
- Your profit is **$1,000 before borrowing fees and other costs**.

If the price rises instead, you lose money. Losses are theoretically unlimited because a stock’s price has no upper limit. Shorting generally requires a margin account, available shares to borrow, and enough collateral; your broker may require additional funds or close your position. [SEC explanation of short selling](https://www.investor.gov/introduction-investing/investing-basics/how-stock-markets-work/stock-purchases-and-sales-long-and).

**2. Buying put options**

A put gives you the right to sell shares at a specified price—the *strike price*—by an expiration date. You pay an upfront price called the *premium*.

Suppose a stock trades at $50 and you buy a $50-strike put for $2 per share. A standard U.S. stock option usually covers 100 shares, so it costs $200.

- If the stock is $40 at expiration, the put is worth $1,000, giving you **$800 profit before fees**.
- If it is $49 at expiration, the put is worth only $100, so you **lose $100 despite correctly predicting a decline**.
- If it is $50 or higher at expiration, the put expires worthless and you lose the $200 premium.

You can generally sell the option before expiration to close the trade. For the purchased option itself, your maximum loss is the premium paid. [SEC introduction to options](https://www.investor.gov/introduction-investing/general-resources/news-alerts/alerts-bulletins/investor-bulletins-63).

For your “next week” scenario, **predicting the direction alone is insufficient for puts: the size and timing of the fall must justify the premium**. Short selling tracks the price decline more directly, but carries much greater potential loss.