​Weekly: Insurers Eye Long Puts; Investors Eye SX7E, AT1 Decorrelation

Trading in CBOE’s VIX picked up Friday, with one investor picking up 30,000 contracts targeting 26 for .14c. Other trades today included another investor buying 20,000 May 20 puts for USD2.47. In our recent U.S. coverage, we look at the prospect of insurance firms buying long puts again this year as their legacy positions expire. They’ve been out of the market over the last 12 months, but will have to start long put buying again if they want to maintain their portfolios’ vega. In Europe, investors are considering opportunities to play the decorrelation between European bank equity and banks’ Additional Tier 1 instruments by going long SX7E futures and short a basket of AT1s. Don’t forget to check out some of our coverage from this year’s CBOE RMC, which took place this year in Bonita Springs, Fla. Expect more to come in the upcoming EQD Magazine.