Record low HSCEI skew as Hong Kong markets boom
Call option volumes trebled in April as bourse hits multi-year highets boom
Call option interest outpacing the demand for puts on Chinese stocks has caused the volatility skew on the Hang Sang China Enterprise Index (HSCEI) to turn steeply negative and is reminiscent of 2007, when the market peaked before a precipitous fall.
HSCEI three-month 105–115% skew is at minus two volatility points following big market moves in the underlying index. Hong Kong's benchmark Hang Seng index (HSI) shot up 7.3% on April 9 before retreating but is still at a multi-year high of 27,000
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