Daniel Och’s hedge-fund group bought options on almost $12 billion of U.S. stocks during the first quarter, a move that may generate profits if markets turn more volatile this year, Bloomberg reports.
The strategy, disclosed in a May regulatory filing by New York-based Och-Ziff Capital, included an $8.8 billion option bet on companies in the Standard & Poor’s 100 Index. The firm bought both bearish put options and bullish calls on most of the members, including Exxon Mobil, American Express and General Electric...
“The only reason you would want to do this is if you were massively concerned about the markets on the whole and expected volatility to rise,” Christopher Rich, head options strategist at JonesTrading Institutional Services LLC in Chicago said in an interview. “Going from zero to this is very, very significant.”
Find out more at:
http://www.bloomberg.com/news/2011-06-16/och-ziff-may-profit-from-market-turbulence-with-12-billion-options-bet.html
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