President Trump hosts Xi Jinping on September 24, days after the Fed’s first rate hike since 2023. Tariffs, rare earths, chip policy and Taiwan are all in play — and SpotGamma’s Compass shows cheap implied volatility across several China-sensitive names.
risk reversal
Record Highs and Thinning Hedges
Last week, the S&P 500 closed its eighth straight weekly gain — the longest streak since 2023. As the rally continues to achieve record highs, underlying options positioning has evolved meaningfully since March. Most importantly, the market has quietly shed much of the protective hedging that was in place just two months ago. A dense […]
Attack of Risk Reversal
@SentimentTrader posted this chart showing record “small” positions in long calls and short puts. Sentiment says these are “10 contracts or fewer per trade”, insinuating retail traders. This type of trade (long call/short put) is a position also known as a risk reversal. While the traders are not likely actually trading short puts and long […]