Extreme Stock Swings Tempt Funds Into Reverse Dispersion Trade

Betting that individual stocks will be volatile while the S&P 500 stays relatively calm has been a popular and successful hedge fund strategy. But with the swings in share prices...

By Bernard Goyder, Felice Maranz and Christian Dass · Bloomberg Markets

Betting that individual stocks will be volatile while the S&P 500 stays relatively calm has been a popular and successful hedge fund strategy. But with the swings in share prices reaching extreme levels, the reverse trade is gaining traction with investors.