Bear Markets in Small Caps Take More to Smother Than This
- Volatility spread between Russell, S&P ETFs most since 2014
- Russell 2000 down 12% in 2016, 23% off all-time high in June
This article is for subscribers only.
Options traders see no relief in sight for small-cap stocks mired in a bear market. They’re driving up the price of protection against further losses.
The cost of contracts on an exchange-traded fund that tracks the Russell 2000 Index is the highest since 2014 versus contracts on the SPDR S&P 500 ETF Trust, according to data compiled by Bloomberg. The rising demand for small-cap hedges comes with the Russell 2000 sitting 23 percent below its 2015 record.