By Gunjan Banerji
Hopes for a Goldilocks economy --one that's not too hot or too cold--have sent prices of everything including bonds, gold and stocks flying.
Activity in options shows many investors are positioning for those gains to continue, says Ashwin Alankar, head of global asset allocation at Janus Henderson Investors.
For example, prices of call options tied to gold, Treasurys, the S&P 500 and even the Russell 2000 index of small stocks have risen relative to put options. Calls give investors the right to buy shares at a specific price, by a stated date, while puts give them to right to sell. It's a sign that some investors are more concerned about missing out on potential gains to come, rather than any declines.
Alankar says he's positioning for that, too.
"I think the worst thing that investors can do right now is remain on the sidelines," he said.
Call options trading tied to the SPDR Gold Shares hit the second-highest level on record in recent sessions, Cboe Global Markets data show. Calls trading in one of the largest Treasury ETFs surged to a record high in November, and hit a record for the iShares Russell 2000 ETF this month.
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(END) Dow Jones Newswires
December 06, 2023 14:24 ET (19:24 GMT)
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