Lead Stories
Wall Street turns to complex trades to dodge AI ‘implosions’; Investment banks hawk complex hedging strategies as ‘whack-a-mole’ sell-off rips through US stocks
George Steer and Rachel Rees – Financial Times
Investors are riding out the “whack-a-mole” software sell-off by loading up on protection against volatility and exploiting the divergence in sectors tipped to be either winners or losers from AI’s advance. Some of Wall Street’s biggest players are turning to complex options and hedging strategies to navigate a market buffeted by blog posts and headlines that have recently wiped tens of billions of dollars off the value of some of the S&P 500’s largest tech groups.
/jlne.ws/3P42Jun
America’s most shorted stock is Wall Street’s Bitcoin machine
Mehab Qureshi – TheStreet
If you had to guess which $40 billion company is currently the most shorted stock in America, you probably would need more than one try. It’s Strategy. Yes, the company formerly known as MicroStrategy. Yes – the Michael Saylor Bitcoin machine. According to Goldman Sachs’ hedge fund positioning data, Strategy has climbed to the top spot among the most shorted large-cap U.S. stocks, measured by short interest as a percentage of market cap. A year ago, it wasn’t even in the top 50.
/jlne.ws/3OJBOnx
Trader Bets $14 Million That Losing Warner Bid Would Be Win for Netflix
David Marino and Youkyung Lee – Bloomberg
An options trader appears to be betting almost $14 million that Netflix Inc. will win should it lose out on its bid to acquire Warner Bros. Discovery Inc. The speculator bought 55,000 May $90 call options on Wednesday, selling the same number of $105 calls to partially fund the position, data compiled by Bloomberg show. The call-spread strategy cost about $2.51 for each contract, for a total of $13.8 million, and gives the right to buy 5.5 million shares if Netflix rallies from its current level of about $83.
/jlne.ws/4s5fKlQ
Jane Street Speculation Renews Scrutiny of Bitcoin ETF Market Mechanics
Sebastian Sinclair – decrypt
Bitcoin’s Wednesday rally has reignited debate over the role of Wall Street market makers in spot Bitcoin exchange-traded funds, after online speculation linked the price move to a lawsuit involving quantitative trading firm and liquidity provider Jane Street. Posts circulating on X claimed that Bitcoin’s roughly 10% climb over two days coincided with the disappearance of a purported intraday selling pattern, suggesting that legal action against Jane Street had altered market behaviour.
/jlne.ws/46t6Qq1
Exchanges
Miami International Holdings Reports Fourth Quarter and Full Year 2025 Financial Results
MIAX
Miami International Holdings, Inc. (MIAX) (NYSE: MIAX), a technology-driven leader in building and operating regulated financial markets across multiple asset classes, today announced results for the fourth quarter and full year 2025.
/jlne.ws/4aRREUq
CME Restarts Metals, Gas Futures After Glitch Halts Trading
Julian Hast and Yvonne Yue Li – Bloomberg
Trading in US natural gas futures was halted for more than half an hour on Wednesday, the second major disruption in a month in one of the most heavily traded commodity markets. Metals contracts were also affected. CME Group Inc. said gas futures and options on its Globex electronic platform restarted trading after an interruption due to technical issues. The halt, which CME said lasted about 50 minutes for gas futures and 35 minutes for options, came on the same day that the natural gas futures contract for March delivery expired, a key date for traders looking to roll over their positions. Prices rose before settling 1.9% higher at $2.969 per million British thermal units.
/jlne.ws/4rKGZT6
LSEG Unveils ÂGBP3 Billion Buyback, Falling Short of Elliott Target
Meg Short – Bloomberg
The London Stock Exchange Group Plc has announced plans to buy back ÂGBP3 billion ($4.1 billion) of its own shares, as it reported full-year results less than a month after it emerged that Elliott Investment Management had taken a stake. The group, which bought back ÂGBP2.1 billion in 2025, has already purchased ÂGBP415 million of its own shares in the year to date and plans to pay out the additional ÂGBP3 billion by February next year, according to a statement Thursday. The company also hiked its final dividend 15.7% to 103 pence a share and set new guidance for the next two years.
/jlne.ws/4qTvirJ
Regulation & Enforcement
Regulators Cracked Down on India’s Giant Options Market. Did it Work?
Ashutosh Joshi – Bloomberg
In just five years, India has gone from being a small player in the market for equity derivatives to the world’s largest. Around $5.5 trillion of these highly speculative instruments are now traded in Mumbai on a daily basis. Inexperienced retail investors have been piling into a form of derivative known as equity options in search of quick returns, alarming the country’s markets watchdog, which has warned repeatedly that they face significant losses if the bets go wrong.
/jlne.ws/4rGJGoy
Kalshi Fines Former Gubernatorial Candidate, MrBeast Employee on Prediction Wagers
Krystal Hur – The Wall Street Journal
A former California gubernatorial candidate and a video editor for YouTube streamer MrBeast were fined by Kalshi for violating its rules for making prediction-market wagers on its platform. Their fines were the first disciplinary actions to be disclosed publicly by Kalshi, the company said.
/jlne.ws/4r1SrZ8
Strategy
Stock Investors Are Hedging a Drop. Strategists See a Buy Signal
Bernard Goyder – Bloomberg
The S&P 500 has been stuck in a range for the better part of four months, and investors are paying up to protect against the possibility that the next big move is down. To a growing number of strategists, that pessimism is cause to expect the opposite. The change in mood among investors, particularly the retail crowd, arrives as the S&P 500 has churned below 7,000 for most of the year, defying predictions that a breakout is imminent. There are, of course, reasons for the stagnation. Artificial intelligence tools have led to big selloffs in a variety of sectors, trade policies remain opaque and geopolitical tensions are high.
/jlne.ws/4aEUcXq
Traders Pile Into Bearish Yuan Bets to Hedge Downside Risks
George Lei – Bloomberg
Traders have boosted bearish wagers on the yuan to the highest since April, looking to protect against downside risks in the wake of a strong rally and ahead of a period of traditional weakness in the Chinese currency. So-called risk reversals on the offshore Chinese yuan have kept moving into positive territory over the past couple sessions. That’s a sign that traders are paying much more for call options that bet on a higher dollar-yuan pair over the coming months, than puts that look for the pair to decline over the same period.
/jlne.ws/4rXyfsV
