Just over a year ago, as 0-DTE (Zero-Day-To-Expiration) options trading was starting to really accelerate, fear and loathing was spreading through the markets about whether these new ultra-short-dated momentum-mania trading instruments would cause a vicious (or virtuous) cycle in underlying equity markets as the tail increasingly wagged the dog.
JPM's Kolanovic Warns 0DTE Can Lead To Volmageddon 2.0, $30 Billion In Intraday Selling
No, 0DTE Will Not Result In "Volmageddon:" BofA Derivative Gurus Respond To Kolanovic
Forget "Volmageddon", 0DTE Add Noise To 'Untradable Mess' But Not Driving 'Downside Risk'
"It's Not Retail" - JPMorgan Defends 0DTE 'Volmageddon 2.0' Risk Warning
Volmageddon? No; JPM, BofA Say 0-DTE Options Are Suppressing Intraday Vol
A year later and while we have not seen a repeat of 'Volmageddon' - in fact volatility is at its lowest since 0-DTE options started trading - volumes have continued to rise and while while BofA's global equity vol insights team says there does not appear to be any imbalances currently, there remains the possibility that these increasingly utilized instruments could fracture an already fragile market.
