Hedging Boom Sets Up ‘Extra Spicy’ Options Day for Credit ETF
- Junk-debt ETF’s put open interest hits a record before expiry
- Dealer hedging may make Friday’s rollover volatile: McElligott
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Wall Street’s monthly expiry of options is normally associated with fireworks in the equity market, but corporate bonds could be in the mix when the next “OpEx” unfolds on Friday.
A surge in bearish positioning on the iShares iBoxx High Yield Corporate Bond ETF (ticker HYG) means this month’s OpEx could be “extra spicy” for the $16 billion exchange-traded fund, reckons Charlie McElligott at Nomura Holdings.