Fearless Stock Bulls Start Hedging as Fed Policy Pivot Stalls
- Cboe Volatility Index closed at highest in months on Thursday
- Demand for S&P 500 puts relative to equivalent calls picks up
A trader works on the floor of the New York Stock Exchange in New York.
Photographer: Michael Nagle/BloombergThis article is for subscribers only.
A bumpy week for the S&P 500 Index prompted long-complacent traders to look at the hedges they’ve ignored for months.
The demand for broad market insurance plunged to multi-year lows in the first quarter as US stocks posted a series of fresh highs despite growing geopolitical tensions and uncertainty over interest rates. This week, that changed as the desire to protect against a downturn increased by a number of measures.