Six Years After Volmageddon, Volatility Fears Return: MLIV Pulse

Six years after a famous blowupin the volatility market shattered a lengthy calm in US stocks, the latest Bloomberg Markets Live Pulse survey reveals growing Wall Street concern over a new boom in trades that bet against equity turbulence.

In this latest era of prolonged stock-market serenity, billions of dollars are pouring into strategies that seek to juice returns by selling options.

These so-called short-volatility trades are a dangerous way to generate income, according to 71% of 377 MLIV Pulse respondents. Some 59% fear the current boom is a possible threat to the market. Even among those who said they use ...