Investors bear-up on ASX

From the SMH blog:

Investors are the most bearish on Australian stocks since 2007 after last month’s rally pushed up valuations by the most since April and the central bank signaled a reluctance to add stimulus to the economy.

Outstanding put options on the S&P/ASX 200 Index outnumbered equivalent call contracts by 2.50 times on March 3, according to data compiled by Bloomberg. The ratio rose to 2.52 on Feb. 28, the highest since September 2007.

Bearish three-month options yesterday cost 7.1 points more than bullish ones, up from 5.8 points at the end of 2013, the data show.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.