Last week, institutional traders bought $8.1 billion worth of put options.
They bought less than $1 billion in calls.
This is 3x more extreme than 2008.
But with normalized perspective by equity market cap, some analysts say it’s not so much as we see now.
In Russell 3000 Index, market cap changes from $10t in 2008 to $41t today.
So with normalized view, 3x size in hedges may not be extreme anymore.
Anyhow, directionally, it is right that institutions prepare worse market environment while the level of preparation could be different.