Wild Stock Swings Keep Favorite Wall Street Option Trade Humming
A trader works on the floor of the New York Stock Exchange (NYSE) in New York, on Feb. 6.
Photographer: Michael Nagle/BloombergThe volatility in pockets of the European and US equity markets has yet to engulf the broader indexes, boosting demand for option strategies betting on further dispersion.
Equity-market volatility — which has been more subdued than the price swings in other markets like precious metals and currencies so far this year — roared back as software stocks, in particular, were whipped about by concerns about the threats posed by AI. A key software exchange-traded fund in the US fell 12% from Monday through Thursday before rebounding 3.5% on Friday, while the high-low range of the S&P 500 Index for the week was just around 3%.