The Markets Hidden Volatility
22 snips
Oct 3, 2025 
Brian Garrett, head of equity execution at Goldman Sachs, shares insights on the volatility lurking beneath the calm surface of the S&P 500. He discusses how retail investors are driving upside volatility and explains the recent trend where rallies surpass sell-offs. Garrett also reassesses the October volatility effect, emphasizing AI catalysts in mega-caps. He touches on the limited impact of the government shutdown and offers practical hedging strategies, while flagging key upcoming market events to keep an eye on.
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Index Calm, Single-Stock Whipsaw
- The S&P's calm mask hides much higher single-stock volatility across the market.
- The average S&P and Nasdaq stock has been ~3.5x more volatile than their index, creating whippy single-stock tape.
Retail Buying Inverts Call Skew
- Retail derivatives activity has changed the options surface, especially for upside calls.
- Over half of S&P Top 100 names now show inverted call skew, which is highly unusual.
More Volatility On The Upside
- Recent market moves have been more volatile to the upside than downside on average.
- When green, S&P rallies average ~50bps versus ~30bps on red days, so upside volatility dominates recently.