Wall Street’s Hedging Craze Gets Second Wind After 2024 Misfire

In the euphoric markets of 2024, the biggest sin was skepticism. A white-hot runup in risky assets made life miserable for anyone buying into the frenzy of fresh products that Wall Street was hawking to hedge and diversify.

Three weeks into this year’s market whiplash, it’s starting to look like the sales pitch was simply too early. Big, lockstep moves have become the norm on the eve of Donald Trump’s inauguration. The latest example: this week’s stock-bond rally comes right after an equally large swoon just last week, marking the biggest reversal of its kind in 18 months.