Black Swan Options See Stampede as Brexit Decision Looms: Chart

Colm Kelleher: Brexit Most Consequential Post-War Event

Bets are starting to pile up in distant corners of the U.S. options market that Thursday’s U.K. referendum will ignite serious losses in stocks. Consider one S&P 500 contract that would move in the money should the index plunge 20 percent to 1,675 by Friday. Open interest in the put has doubled and is now the second highest of any bearish weekly contract tracked by Bloomberg. “It’s a black swan type of put,” said Steve Sosnick of Timber Hill LLC. “It’s very possible there will be an extreme result, and people like to have insurance against a low-probability, high-outcome event.”

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