Stock Manager Paranoia Is Only Thing the Market Has Going for It
- Seasonal pattern puts equity bears on alert for year-end rally
- Active-manager poll, options activity show fear of missing out
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Another week of gloom on the inflation and central bank fronts turned into a positive one for the equity faithful. Shares surged the most in four months as evidence built that active fund managers are getting worried about missing a winter rally.
It’s an old investment saw that cuts surprisingly well: the idea that institutional investors -- alert to catastrophe in the closing stretch -- bid up markets in November and December. The case is stronger in 2022 with midterm elections approaching, traditionally a pressure-reliever for bulls that on average gives rise to more gains.