Top Traders Unplugged

UGO03: This Isn’t 2008. That’s the Problem ft. Benn Eifert

55 snips
Jun 11, 2025
Guest
Benn Eifert
Benn Eifert, CIO and Managing Partner at QVR, offers deep insights into today’s volatility regime. He discusses how market structure influences outcomes more than macroeconomic factors. Eifert highlights the fragmented liquidity and the breakdown of correlations, stressing that the path of market movements is more significant than their magnitude. The conversation dives into the rise of zero-day options and their implications on trading strategies, while also examining the unique dynamics of retail trading and the evolving landscape of financial markets.
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INSIGHT

Speed Drives Volatility Explosions

  • Volatility spikes are driven more by the speed of market declines than their magnitude.\n- Fast crashes cause dealers to scramble on gamma hedging, pushing implied vol sharply higher.
INSIGHT

Volatility Correlation Is Cyclical

  • Volatility correlation with market declines follows a cyclical pattern depending on positioning.\n- After a spike, short vol positions are washed out, leading to underperformance of vol hedges in subsequent declines.
INSIGHT

Slow Declines With Vol Compression

  • Current market positioning lacks overlevered short vol trades to trigger big volatility spikes.\n- Expected declines may be slow and choppy with volatility compression rather than explosive spikes.
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