Stock market bubble forming, cheap strategy to hedge: Bank of America - Business Insider

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Bank of America warns a new bubble may be forming in the stock market — and shares a cheap strategy for protection that is 'significantly' more profitable than during the last 10 years

Join BI PrimeThe attractiveness of US assets relative to the rest of the world is brewing a bubble in the stock market, according to equity-derivatives strategists at Bank of America.

Most importantly, the US has provided more monetary and fiscal support than any other country during this downturn and made the appeal of its financial assets irresistible. The backdrop for this bubble scenario is the worst economic contraction since the Great Depression, which investors appear to be tossing to the back seat. But the strategists' study ofled to the conclusion that a a sustained rebound from the March low would be a historical anomaly.

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