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Not everyone on Wall Street is convinced that the worst is over.
In fact, some investors are betting tens of millions of dollars that the market is headed for a selloff -- a major selloff.
The reason: worries about a worsening credit crunch, along with speculation that the Federal Reserve may defy expectations and hold off on cutting interest rates at its Sept. 18 meeting.
So far, over $500 million in so-called put options have been purchased betting that the benchmark Standard and Poor's 500 index will tumble anywhere from 5% to 11% in September. Some investors are even buying put options calling for 52% decline. A "put" option increases in value as the underlying stock or index falls.
Originally posted by HothSnake1
It is a quick fix that spells certain long-term doom.