Business & Finance
Costs to Hedge the $9 Trillion S&P 500 Rally Jump Ahead of Fed
Key Points
Costs to Hedge the $9 Trillion S&P 500 Rally Jump Ahead of Fed Sentiment in the US stock market has shifted quickly from fear of missing out to fear of getting wiped out. Traders nervous about a further plunge in US stocks in the coming weeks are loading up on downside protection. That’s pushed the one-month skew, a measure of demand for options to protect against a drop in the S&P 500 Index, from the lowest in a year to a 72nd percentile of observations, according to data compiled by Mandy...
Costs to Hedge the $9 Trillion S&P 500 Rally Jump Ahead of Fed
Sentiment in the US stock market has shifted quickly from fear of missing out to fear of getting wiped out.
Traders nervous about a further plunge in US stocks in the coming weeks are loading up on downside protection. That’s pushed the one-month skew, a measure of demand for options to protect against a drop in the S&P 500 Index, from the lowest in a year to a 72nd percentile of observations, according to data compiled by Mandy Xu, head of derivatives market intelligence at Cboe Global Markets Inc.