US funds piled on index hedges ahead of stock selloff

Michael Paterakis
31 Jan 2022

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US mutual funds were positioning for an equity market selloff in the third quarter of last year, as climbing inflation increased pressure on the Federal Reserve to taper its bond-buying programme and hike rates.

Managers added over $5.5 billion of bought index puts – setting a new high-water mark – according to an analysis of the sector’s regulatory filings. By the end of the third quarter, the total notional value of bought puts stood at $64.7 billion, up from the $59.2 billion book reported

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