Options, Risk Management, Implied Volatility & Co.
Muting Joined
A Safer Way to Bank on the Banks
IF DURING THE PAST YEAR any investor with bearish views on the financial sector needed assurance, all they had to do was look at options trading on the Financial Select Sector SPDR (XLF). During the past 12 months, investors traded more than five million XLF contracts at a rate of 5.7 puts for every call, a level of pessimism not often encountered.
Yet the mood toward the financial sector seems to be changing. Yesterday, a portfolio manager bought 40,000 March...