NEW YORK - Options players are piling in to riskier bets across the U.S. stock market, supporting a rally that has come on the back of fading election worries and expectations of a Republican lock on power in Washington next year."We've got this relief from this big risk," said Garrett DeSimone, head of quantitative research at OptionMetrics."It's just across the board ... you've got everything, with the exception of bonds, going up.
Investors are"panicking to chase stocks at all time highs," said Charlie McElligott, managing director of cross-asset strategy at Nomura, in a note earlier this week. "What the volatility market was worried about didn't come to fruition, so all that excess worry came out of the market," said Michael Thompson, co-portfolio manager at boutique investment firm Little Harbor Advisors.
Investors' overall rush into bullish options may be helping fuel the rally in stock prices, analysts said. Stocks fell on Thursday after Federal Reserve Chairman Jerome Powell said there was no need for the central bank to rush interest rate cuts given the strong economy. The effect of Trump’s policies on economic growth will not become clear until new laws or administrative edicts are approved or issued, he added.