Options markets are exhibiting two unusual dynamics at the moment that can provide some insight on investor positioning and sentiment. For contrarians, the signals suggest the market is underprepared for disappointment on politics, virus, unemployment or anything else for that matter.

Firstly the Put-Call ratio is tracking at close to 20-year lows. This ratio references the number of put options held by investors versus call options. Investors will typically buy put options for protection and call options to express a bullish view, so when the balance changes it can reflect a change in investor sentiment and positioning.

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