The United States stock market has experienced a rally following the recent presidential election, reaching unprecedented highs. However, this surge has been accompanied by a countervailing rise in investor anxiety, as evidenced by a growing demand for options protection against potential market crashes. This anxiety is not without reason, as looming geopolitical and economic risks weigh heavily on the minds of investors.

The U.S. stock market's recent gains were spurred by the resolution of election-related uncertainties, particularly as lingering doubts of a contested election dissipated. The S&P 500 reached historic peaks, and the Cboe Volatility Index reflected a marked decline in market anxiety, plummeting to a post-election low of 14.10. Conversely, the Cboe Skew Index, measuring the likelihood of extreme market movements, hit a notable two-month high, indicating simmering concerns of unsettling market shifts.

Adding to the potential for market upheaval, policy risks linked to President-elect Donald Trump's administration are a significant concern. Trump's recent declarations of imposing substantial tariffs on major trade partners, including Canada, Mexico, and China, have stirred memories of tariff-induced market destabilizations during his initial term. This pronouncement reignited investor interest in hedging strategies, despite the broader market's relative indifference to the trade threats.

Key metrics such as the Nations TailDex Index and the Cboe Skew Index have risen, demonstrating heightened investor apprehension. The Nations TailDex Index, an options-based metric assessing protection costs against outsized movements in the SPDR S&P 500 ETF Trust, has surged to 13.64 from a post-election nadir of 6.68. These figures corroborate investor calls for protection as they recall the volatility wrought by similar tariff threats earlier.

Market experts like Amy Wu Silverman of RBC Capital Markets underscore the prevailing unease tied to 'fat tail risks,' a term describing heightened probabilities of extreme market disruptions. This is echoed in the demand for VIX call options, a commonly used hedge against market downturns, where the VIX three-month call skew has touched its peak level in five years. This data, noted by Susquehanna Financial Group, suggests an acute focus on guarding portfolios against unforeseen downturns.

The Federal Reserve's potential rate cuts amidst a robust economy, along with fears of an inflationary spiral if monetary easing goes too far, add to the uncertainty. The Fed's upcoming monetary policy meeting, alongside international concerns such as the Russia-Ukraine conflict and Israel-Hamas tensions, further compound the market's vulnerability.

Equity derivatives specialists warn that sustained tariff rhetoric could trigger hedging activities reminiscent of the 2018 market episode, where initial stock gains were swiftly curtailed by trade tensions. Maxwell Grinacoff of UBS notes these parallels with 2018, highlighting concerns as investor moods oscillate between optimism and caution.

In a broader economic context, there is palpable worry regarding inflationary pressures and interest rate maneuvers imperative to sustain market equilibrium amidst vigorous geopolitical interplay. As these multifaceted risks unfold, they underscore the intricate dynamics that investors must navigate to protect themselves in a landscape rife with potential economic jolts.