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Investors are hedging their long positions with option on inverse ETF following S&P

option hedging

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While the S&P 500 Index raced past its 60th record of the year, investors are increasingly using options on a leveraged exchange-traded fund that bets against it. The number of calls outstanding on the ProShares UltraPro Short S&P 500 ETF has surged to a peak, and the overall average daily volume of contracts changing hands this month reached its highest since the rout of August 2015. With the S&P 500 up 19 percent this year, the fund has lost 43 percent and is heading for a third month of outflows. These hedges means that investors aren't quite certain that the rally of S&P will condinue and they are hedging their long positions.

Source: Bloomberg Pro Terminal

Trader Bozhidar Arabadzhiev


 Varchev Traders

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