U.S. options market not very 'Trumped up' ahead of voteNEW YORK (Reuters) - Prospects that the presidential election will inject a hefty dose of volatility into U.S. stock markets are fading fast as Republican Donald Trump’s victory odds lengthen. A reading of positioning data on options tied to the benchmark S&P 500 index shows little pickup in demand for contracts that would offer investors downside insurance in the event that stock prices take a major hit right after the Nov. 8 election. Moreover, based on options term structures - calculated from prices of options with different expirations - it is hardly evident at all that investors are positioning for an uncertain outcome, even with Election Day barely two weeks away, Michael Purves, head of derivatives research at Weeden & Co, said. “There had been a modest premium bump for November options a few weeks ago, but that seems to have faded steadily with Trump’s slide in polls,” Purves said. In a Reuters poll of equity strategists earlier this month, a victory by Democrat Hillary Clinton was viewed as the more positive outcome for stock prices in the near term.  Trump’s chances of defeating Clinton to capture the White House have diminished markedly over the last several weeks, according to most polls and prediction markets. The Reuters/Ipsos States of the Nation project, which uses an online opinion poll to project election outcomes in all 50 states, estimates that Clinton has a better than 95 percent chance of winning the minimum of 270 Electoral College votes to claim the presidency if the election were held today. The most likely outcome would be 326 votes for Clinton to 212 for Trump. On PredictIt, a popular online predictions and betting market, Clinton’s implied chances of victory have risen to around 80 percent from around 63 percent a month ago. The lack of positioning for an election-related volatility shock is consistent across the options market. “I just don’t see a whole lot of shifting of positions. I don’t see people taking on a very bearish stance or anything like that. It’s a little bit surprising,” said Randy Frederick, managing director, trading and derivatives at Charles Schwab, Austin, Texas. “If it was a much closer race it might have been a different story, but the polls have Hillary Clinton in a pretty solid lead right now and the market seems to be on board with that idea,” Frederick said. A Brookings Institution study published on Friday from two U.S. economics professors concluded that a Clinton victory would further suppress stock market volatility, whereas a Trump victory would send it soaring. Justin Wolfers, of the University of Michigan, and Eric Zitzewitz, of Dartmouth College, said recent market reactions to pre-election events, including the first Trump-Clinton debate and the release of a video of Trump making vulgar comments about women, signal that equity volatility could fall by 15 to 30 percent with a Clinton win. (tinyurl.com/zl4ew4u) While the options market might be only a moderate catalyst for the S&P 500 index, individual sectors such as healthcare and energy might be more prone to election-related volatility, derivatives analysts at Deutsche Bank said in a recent note. And just because investors are not braced for election-linked stock gyrations is no guarantee that markets will remain calm, analysts said. Given that the market is not pricing a lot of volatility for November, the absence of positioning could aggravate a volatility shock in the event of a surprise result. “If you think Trump will win, you want to get long SPX puts or long CBOE Volatility Index calls right now as protection,” said Purves, referring to options contracts that profit from a jump in volatility. A clean sweep by the Democrats of the House of Representatives, the Senate and the White House could also unleash volatility, Purves said. Indeed, there is a very modest skew toward protective put options over more bullish calls among contracts expiring near the election. For S&P 500 index weekly contracts expiring on Nov. 11, puts outnumber calls by a 2.1-to-1 margin, compared with 1.9-to-1 for all expirations, according to Thomson Reuters data. Prices for at-the-money put and call contracts that expire on the eve of the election suggest a 1.8 percent move, up or down, in the S&P 500 by then, while comparable contracts expiring later that week see an up or down move of 2.1 percent. Nonetheless, demand for volatility protection remains low and such options are relatively cheap, and getting cheaper.  For instance, the cost for an S&P index option conveying the right to sell an S&P index future at the 2,050 level, about 4 percent below Friday’s close, and expiring on Nov. 9, the day after the election, has plunged from $12.42 on Monday to $4.80 on Friday, a 61 percent decline. With Trump trailing in opinion polls, the focus ahead of the Nov. 8 vote is shifting to whether Republicans can keep their narrow majority in the Senate or even their larger advantage in the House of Representatives. “Gridlock is the most market friendly outcome, and that is what the options market seems to be anticipating,” Purves said. politicsNews
options market ahead votenew york reuters prospects presidential election inject hefty dose volatility stock markets fading fast republican donald trump victory odds length a reading positioning data options tied benchmark s p index shows little pickup demand contracts would offer investors downside insurance event stock prices take major hit right election moreover based options term structures calculated prices options different expiration hardly evident investors positioning uncertain outcome even election day barely two weeks away michael curves head derivatives research werden co said there modest premium bump november options weeks ago seems faded steadily trump slide polls curves said in reuters poll equity strategist earlier month victory democrat hillary clinton viewed positive outcome stock prices near term trump chances defeating clinton capture white house diminished markedly last several weeks according polls prediction markets the states nation project uses online opinion poll project election outcomes states estimates clinton better percent chance winning minimum electoral college votes claim presidency election held today the likely outcome would votes clinton trump on predicted popular online predictions betting market clinton implied chances victory risen around percent around percent month ago the lack positioning volatility shock consistent across options market i see whole lot shifting positions i see people taking parish stance anything like it little bit surprising said randy frederick managing director trading derivatives charles schwab austin texas if much closer race might different story polls hillary clinton pretty solid lead right market seems board idea frederick said a bookings institution study published friday two economics professors concluded clinton victory would suppress stock market volatility whereas trump victory would send soaring justin golfers university michigan eric zitzewitz dartmouth college said recent market reactions events including first debate release video trump making vulgar comments women signal equity volatility could fall percent clinton win while options market might moderate catalyst s p index individual sectors healthcare energy might prone volatility derivatives analysts deutsche bank said recent note and investors braced stock rations guarantee markets remain calm analysts said given market pricing lot volatility november absence positioning could aggravated volatility shock event surprise result if think trump win want get long px puts long oboe volatility index calls right protection said curves referring options contracts profit jump volatility a clean sweep democrats house representatives senate white house could also unleash volatility curves said indeed modest skew toward protective put options publish calls among contracts expiring near election for s p index weekly contracts expiring puts outnumber calls margin compared expiration according thomson reuters data prices put call contracts expire eve election suggest percent move s p comparable contracts expiring later week see move percent nonetheless demand volatility protection remains low options relatively cheap getting cheaper for instance cost s p index option conveying right sell s p index future level percent friday close expiring day election plunged monday friday percent decline with trump trailing opinion polls focus ahead vote shifting whether republicans keep narrow majority senate even larger advantage house representatives gridlock market friendly outcome options market seems anticipating curves said politicsnews
Your task is to classify the provided input as real or fake news. Label 0 is meant for fake news, Label 1 is for real news. TEXT: U.S. options market not very 'Trumped up' ahead of voteNEW YORK (Reuters) - Prospects that the presidential election will inject a hefty dose of volatility into U.S. stock markets are fading fast as Republican Donald Trump’s victory odds lengthen. A reading of positioning data on options tied to the benchmark S&P 500 index shows little pickup in demand for contracts that would offer investors downside insurance in the event that stock prices take a major hit right after the Nov. 8 election. Moreover, based on options term structures - calculated from prices of options with different expirations - it is hardly evident at all that investors are positioning for an uncertain outcome, even with Election Day barely two weeks away, Michael Purves, head of derivatives research at Weeden & Co, said. “There had been a modest premium bump for November options a few weeks ago, but that seems to have faded steadily with Trump’s slide in polls,” Purves said. In a Reuters poll of equity strategists earlier this month, a victory by Democrat Hillary Clinton was viewed as the more positive outcome for stock prices in the near term.  Trump’s chances of defeating Clinton to capture the White House have diminished markedly over the last several weeks, according to most polls and prediction markets. The Reuters/Ipsos States of the Nation project, which uses an online opinion poll to project election outcomes in all 50 states, estimates that Clinton has a better than 95 percent chance of winning the minimum of 270 Electoral College votes to claim the presidency if the election were held today. The most likely outcome would be 326 votes for Clinton to 212 for Trump. On PredictIt, a popular online predictions and betting market, Clinton’s implied chances of victory have risen to around 80 percent from around 63 percent a month ago. The lack of positioning for an election-related volatility shock is consistent across the options market. “I just don’t see a whole lot of shifting of positions. I don’t see people taking on a very bearish stance or anything like that. It’s a little bit surprising,” said Randy Frederick, managing director, trading and derivatives at Charles Schwab, Austin, Texas. “If it was a much closer race it might have been a different story, but the polls have Hillary Clinton in a pretty solid lead right now and the market seems to be on board with that idea,” Frederick said. A Brookings Institution study published on Friday from two U.S. economics professors concluded that a Clinton victory would further suppress stock market volatility, whereas a Trump victory would send it soaring. Justin Wolfers, of the University of Michigan, and Eric Zitzewitz, of Dartmouth College, said recent market reactions to pre-election events, including the first Trump-Clinton debate and the release of a video of Trump making vulgar comments about women, signal that equity volatility could fall by 15 to 30 percent with a Clinton win. (tinyurl.com/zl4ew4u) While the options market might be only a moderate catalyst for the S&P 500 index, individual sectors such as healthcare and energy might be more prone to election-related volatility, derivatives analysts at Deutsche Bank said in a recent note. And just because investors are not braced for election-linked stock gyrations is no guarantee that markets will remain calm, analysts said. Given that the market is not pricing a lot of volatility for November, the absence of positioning could aggravate a volatility shock in the event of a surprise result. “If you think Trump will win, you want to get long SPX puts or long CBOE Volatility Index calls right now as protection,” said Purves, referring to options contracts that profit from a jump in volatility. A clean sweep by the Democrats of the House of Representatives, the Senate and the White House could also unleash volatility, Purves said. Indeed, there is a very modest skew toward protective put options over more bullish calls among contracts expiring near the election. For S&P 500 index weekly contracts expiring on Nov. 11, puts outnumber calls by a 2.1-to-1 margin, compared with 1.9-to-1 for all expirations, according to Thomson Reuters data. Prices for at-the-money put and call contracts that expire on the eve of the election suggest a 1.8 percent move, up or down, in the S&P 500 by then, while comparable contracts expiring later that week see an up or down move of 2.1 percent. Nonetheless, demand for volatility protection remains low and such options are relatively cheap, and getting cheaper.  For instance, the cost for an S&P index option conveying the right to sell an S&P index future at the 2,050 level, about 4 percent below Friday’s close, and expiring on Nov. 9, the day after the election, has plunged from $12.42 on Monday to $4.80 on Friday, a 61 percent decline. With Trump trailing in opinion polls, the focus ahead of the Nov. 8 vote is shifting to whether Republicans can keep their narrow majority in the Senate or even their larger advantage in the House of Representatives. “Gridlock is the most market friendly outcome, and that is what the options market seems to be anticipating,” Purves said. politicsNews
Your task is to classify the provided input as real or fake news. Label 0 is meant for fake news, Label 1 is for real news. TEXT: options market ahead votenew york reuters prospects presidential election inject hefty dose volatility stock markets fading fast republican donald trump victory odds length a reading positioning data options tied benchmark s p index shows little pickup demand contracts would offer investors downside insurance event stock prices take major hit right election moreover based options term structures calculated prices options different expiration hardly evident investors positioning uncertain outcome even election day barely two weeks away michael curves head derivatives research werden co said there modest premium bump november options weeks ago seems faded steadily trump slide polls curves said in reuters poll equity strategist earlier month victory democrat hillary clinton viewed positive outcome stock prices near term trump chances defeating clinton capture white house diminished markedly last several weeks according polls prediction markets the states nation project uses online opinion poll project election outcomes states estimates clinton better percent chance winning minimum electoral college votes claim presidency election held today the likely outcome would votes clinton trump on predicted popular online predictions betting market clinton implied chances victory risen around percent around percent month ago the lack positioning volatility shock consistent across options market i see whole lot shifting positions i see people taking parish stance anything like it little bit surprising said randy frederick managing director trading derivatives charles schwab austin texas if much closer race might different story polls hillary clinton pretty solid lead right market seems board idea frederick said a bookings institution study published friday two economics professors concluded clinton victory would suppress stock market volatility whereas trump victory would send soaring justin golfers university michigan eric zitzewitz dartmouth college said recent market reactions events including first debate release video trump making vulgar comments women signal equity volatility could fall percent clinton win while options market might moderate catalyst s p index individual sectors healthcare energy might prone volatility derivatives analysts deutsche bank said recent note and investors braced stock rations guarantee markets remain calm analysts said given market pricing lot volatility november absence positioning could aggravated volatility shock event surprise result if think trump win want get long px puts long oboe volatility index calls right protection said curves referring options contracts profit jump volatility a clean sweep democrats house representatives senate white house could also unleash volatility curves said indeed modest skew toward protective put options publish calls among contracts expiring near election for s p index weekly contracts expiring puts outnumber calls margin compared expiration according thomson reuters data prices put call contracts expire eve election suggest percent move s p comparable contracts expiring later week see move percent nonetheless demand volatility protection remains low options relatively cheap getting cheaper for instance cost s p index option conveying right sell s p index future level percent friday close expiring day election plunged monday friday percent decline with trump trailing opinion polls focus ahead vote shifting whether republicans keep narrow majority senate even larger advantage house representatives gridlock market friendly outcome options market seems anticipating curves said politicsnews