JPMorgan’s Kolanovic Warns of ‘Volmageddon 2.0’ Risk in Options
- Sees rise of short-dated options threatening market stability
- Says daily notional volume of 0DTE options is near $1 trillion
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The explosive rise of short-dated options is creating event risk on the scale of the stock market’s early-2018 volatility implosion, according to JPMorgan Chase & Co.’s Marko Kolanovic.
That episode, known as Volmageddon, sparked market chaos exactly five years ago and forced the shuttering of one major volatility-focused exchanged-traded product. The latest proliferation of options with zero days to expiry has similar potential to create market turmoil, the top-ranked strategist says.