Gamma jitters from defined outcome funds
Tumbling equity markets could flip dealers’ exposure to gamma from long to short, leading to hedging losses
An unlikely corner of the structured products market may be building up risky exposure for options dealers.
Yield enhancing options funds came under scrutiny earlier this year after economists blamed their soaring popularity for suppressing the Cboe Volatility Index, Vix. Experts largely dismiss fears that these instruments could spark a sudden reversal of low volatility in a repeat of 2018’s
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe
You are currently unable to print this content. Please contact info@risk.net to find out more.
You are currently unable to copy this content. Please contact info@risk.net to find out more.
Copyright Infopro Digital Limited. All rights reserved.
As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (point 2.4), printing is limited to a single copy.
If you would like to purchase additional rights please email info@risk.net
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (clause 2.4), an Authorised User may only make one copy of the materials for their own personal use. You must also comply with the restrictions in clause 2.5.
If you would like to purchase additional rights please email info@risk.net
More on Investing
Japan’s yen swaps go global
JSCC isn’t just clearing swaps, it is clearing the way for the next stage of Japan’s financial evolution
How Bessent learned to stop worrying and love the T-bill
Short-dated issuance shows no signs of slowing. Some fear it could end badly.
Why a Trumpian world could be good for trend
Trump’s U-turns have hit returns, but the forces that put him in office could revive the investment strategy
Hedge fund holdouts boost euro steepener bets into year-end
After some investors took profits in September, those that stayed in the trade are now doubling down
Dutch pensions weigh hedge unwinds ahead of transition
As January 1 nears, Dutch pension funds consider unwind timing to avoid rush to the exit in thin year-end liquidity
BlackRock, Citadel Securities, Nasdaq mull tokenised equities’ impact on regulations
An SEC panel recently debated the ramifications of a future with tokenised equities
Institutional priorities in multi-asset investing
Private markets, broader exposures and the race for integration
Trend followers search for answers after a year to forget
Quants have new ideas to address strategy’s vulnerability to reversals
