Option Pros Trade Index Versus Index to Play Huge Stock Rotation

Equity-options investors are looking to relative value trades between markets as opportunities to profit from dispersion strategies become scare.

After technology stocks — and in particular those associated with artificial intelligence — led the broader market higher, displacement fears have rippled across industries early in 2026, pushing investors to rotate in and out of sectors at a dizzying speed. The scramble to pick winners and losers of the AI trade has driven one-year implied dispersion to the highest level since around the great financial crisis.

While the strategies have made money this year, with dispersion levels the highest in years ...