Expiry Vol Spike, Defense Holds

What Happened

• Quad-witching delivered the expected volatility spike; index and single-name options rolled with wider spreads.
• The dollar held firm on rate spreads and a small haven bid; yields inched higher with it.
• Flows pivoted back into defense and energy as traders de-grossed high-beta tech into the close.

What It Means

• Today’s stress was mechanical—expiry and dealer hedging—not a macro shock, but it reinforced the existing rotation.
• A firm dollar and higher yields keep pressure on long-duration names while rewarding cash-generative sectors.
• Defense and energy are now the default hiding places when vol jumps; that reflex matters for Q1 positioning.

What I Think

• Expiry didn’t change the story; it reminded the market where sponsorship lives.
• Unless we see a clean dollar reversal, growth multiples keep compressing while value grinds.
• I’m comfortable keeping hedges light and exposure skewed to defensives after this flush.

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Market Terms

• Quad-Witching — Simultaneous expiration of stock index futures and options plus single-stock options.
• De-Grossing — Cutting both longs and shorts to reduce overall exposure.
• High-Beta Tech — Growth names that move more than the market and are sensitive to rate shifts.