AI investors hedge with options and swaps as tech stocks sell off
Amid falling AI stocks and rising borrowing costs, investors are turning to put options and credit-default swaps to protect gains and limit losses, according to The Wall Street Journal. Friday's selloff wiped out more than $1 trillion in market value: the Nasdaq 100 fell 3.4%, the S&P 500 dropped 1.8% and its technology sector lost more than 4.2%. The cost of insuring debt from major tech companies including Amazon, Alphabet, Microsoft, Meta and Oracle rose to its highest level since 2021.
In 40 seconds
- Investors are using put options and credit-default swaps to hedge against a downturn in the AI sector.
- Friday's selloff erased more than $1 trillion in market value; the Nasdaq 100 fell 3.4% and the S&P 500 1.8%.
- The cost of insuring debt from Amazon, Alphabet, Microsoft, Meta and Oracle reached its highest level since 2021.
IASummary generated by artificial intelligence from a story by The Jerusalem Post. It may contain errors: the original source prevails.



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