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US equities show bubble signals as volatility spikes and froth widens

1 min read
Source: MarketWatch
US equities show bubble signals as volatility spikes and froth widens
Photo: MarketWatch
TL;DR

Bank of America derivatives strategists warn the U.S. stock market is edging toward bubble-like conditions, with Nasdaq-100 realized volatility at dot-com-era highs and froth building in pockets such as semiconductors; while the overall market isn’t yet in a bubble, other assets like the Kospi and the Bloomberg Commodity Index show extreme bubble-like dynamics. They suggest momentum plays via QQQ call spreads and hedges like VIX call spreads to navigate the risk amid a momentum-driven rally in megacap tech.

Topics:businessmarkets#bubble#derivatives#equities#markets#semiconductors#volatility
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