© Reuters. FILE PHOTO: A street sign for Wall Street hangs in front of the New York Stock Exchange May 8, 2013. REUTERS/Lucas Jackson/File Photo
By Saqib Iqbal Ahmed
NEW YORK (Reuters) – A string of hefty bets on a doubling of Wall Street’s best known volatility index is raising eyebrows in the U.S. equity options markets, though analysts say they are probably not wagers on a market crash.
Some 100,000 January call options on the Cboe Volatility Index changed hands on Friday, with a strike price of 27. That is nearly twice the current level of the , which has fallen close to a two-month low of 13.69 following a rally that has seen the advance to within 2% of its year high.
Similarly large positions in January VIX options were opened on Wednesday and Thursday. In all, the trader or traders paid about $37 million to buy more than 500,000 VIX January calls.
Past periods when the VIX has doubled within the space of two months have been marked by intense stock market selloffs, such as the COVID-19 market crash of March 2020 and the selloff in March 2018.
The recent large trades, however, are more likely hedges on a portfolio of stocks, rather than wagers on a massive…
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