economy
Bears step up bets against high-yield sector, shaking up bond traders
The iShares iBoxx High Yield Corporate Bond ETF (HYG) saw elevated put volume on Thursday.
TL;DR
- Elevated put volume was observed in the iShares iBoxx High Yield Corporate Bond ETF (HYG) on Thursday.
- One investor made a $1.3 million purchase of 20,000 Jan. 27 75-strike puts.
- Put volume was five times greater than call volume for HYG options.
- Market participants suggest the Federal Reserve's regime change could be a catalyst for this bearish sentiment.
- The continued sell-off in crude oil prices, impacting the energy sector which constitutes over 11% of HYG, is another potential reason.
- The most active HYG option was the 77-strike put expiring Aug. 21, with 40,000 contracts traded.