McElligott: $47BN In Levered ETF Selling, $61BN In Vol Control As The "Best Trade Of The Year" Implodes

Earlier today, as the post-midterm AI liquidation entered its second day, we flagged that Morgan Stanley's derivatives team had calculated a whopping $52 billion in levered ETF selling at the close, assuming prices held at their 1pm levels:

Semis alone would eat $21 billion of that, with another $15 billion hitting the Nasdaq 100. And since nothing on Wall Street stays proprietary for longer than about 45 minutes, the number was quickly "well-socialized," which is precisely the problem that Nomura's Charlie McElligott picked up on in a note published moments ago titled, appropriately enough, "FRONT-RUN OF THE FRONT-RUN MECHANICAL FLOWS" (available to pro subs).