Risk Appetites Dim in Week of New Year’s Angst on Wall Street
- Options hedging grows as traders brace for policy uncertainty
- Risk aversion seen as healthy after bout of gambling spirits
Traders work on the floor of the New York Stock Exchange on Jan. 2.
Photographer: Michael Nagle/BloombergThis article is for subscribers only.
The turning of the calendar is an occasion to look ahead. For Wall Street at New Year’s, the verdict on the future is one of trepidation.
While spirits perked up on Friday, traders across asset classes spent much of the post-holiday period reining in the robust risk appetites that have ruled markets for much of 2024. Volatility measures crept up in Treasuries and corporate credit. They jumped in stocks, which posted the worst end-of-year slump on record. The largest exchange-traded fund tracking Bitcoin, darling of speculators globally, saw its worst-ever outflows.