Hedge Funds Eye Exotic Options to Play Huge Cross-Asset Swings

The wild swings led by oil since the start of the Iran war have institutional investors turning to exotic hybrid options to trade cross-market gyrations.

Oil prices swung almost $36 a barrel on March 9, the biggest one-day range on record, triggering sharp intraday reversals in assets from stocks and bonds to gold and the dollar. Implied volatility measures spiked as traders sought cover from massive swings.