Bonds Are Sounding An Alarm. Stocks Haven’t Heard It Yet.
Friday Afternoon Update
We hedged using optimal puts on Invesco QQQ Trust (QQQ 0.97%↑) this morning, and also took advantage of today's drop to add a bullish bet on Robinhood Markets (HOOD 2.10%↑). You can read about it here.
⚡️Top Names⚡️
— Portfolio Armor (@PortfolioArmor) September 5, 2025
Opened another bullish trade on Robinhood Markets, after it returned to our top names last night.
Plus, a bonus trade and a hedge. $HOOD $SPYhttps://t.co/gc9R9UwQsd
Saturday Afternoon Update
We turned out to have good timing on our Robinhood trade, as news broke after the close that the stock will be added to the S&P 500 index this month.
Robinhood $HOOD will join the S&P 500 on Sept 22, marking a milestone for the fintech sector. Shares jumped 7% on the news as the company transitions from disruptor to index mainstay. What’s the next fintech name you think makes the index?#SPY #HOOD” pic.twitter.com/PnGnVqenbH
— The Alpha Desk (@TheAlphaDesk) September 5, 2025
MOVE Just Screamed. Stocks Haven’t Heard It Yet.
As The Market Ear pointed out yesterday, bond volatility (MOVE) just logged its biggest 2-day jump since April’s “Liberation Day” chaos while the VIX is still half-asleep.
When rates vol rips first, equity vol usually follows—with a lag. If you trade stocks but ignore MOVE, you’re driving by the rear-view mirror.
What MOVE is really telling you
Rates are the fulcrum. MOVE tracks implied vol across Treasury tenors. When it explodes, it’s a risk-free duration VaR shock—the thing every other asset prices off.
The gap matters. A wide MOVE–VIX spread = bonds are pricing regime risk that equities haven’t. Historically, those gaps don’t persist—either MOVE mean-reverts fast, or stocks and VIX catch up.
“Stocks follow inverted MOVE.” This year, the S&P has moved in close tandem with inverted MOVE. The latest divergence is not something to dismiss.
Why now? Pick your catalysts: heavy Treasury supply, sticky inflation prints, BOJ/yen wobble, oil popping, QT liquidity drain, term-premium creep. The 10-year can look “quiet” right before dealers/CTAs re-hedge and mortgage convexity kicks up vol.
If MOVE keeps running, typical playbook
Equities de-rate first on multiple, then earnings worries if the move bleeds into credit.
Crowded longs sell volatility after they need it; liquidity thins into auctions and data.
Gold tends to like rising MOVE (duration stress + hedging flows), but it’s not a hedge for single-name equity drawdowns.
If it’s a head-fake
Great—premium sellers will feast. But you don’t know it’s a head-fake until after the fact. That’s why we pre-commit to defined risk and let the market prove us wrong.
How to Hedge Before VIX Wakes Up (Takes ~60 Seconds)
If you want a rules-based way to cap downside while MOVE is screaming, the Portfolio Armor iPhone app scans all listed options and returns the least-cost hedge that fits your specs.
👉 App: https://apps.apple.com/us/app/portfolio-armor/id394951144
👉 No iPhone? Website: https://portfolioarmor.com/
What you enter
Ticker + shares (SPY, QQQ, or your single name)
Max drawdown you’ll tolerate (e.g., 20%)
Time horizon (e.g., 6 months)
What you get back
Optimal Puts – single-leg protection that minimizes cost for your inputs.
Optimal Collar – same floor, partly/fully financed by a short call you choose (your upside cap). This is how you harvest elevated IV while MOVE is jumpy.
Quick usage
Open the app → Hedge
Enter ticker, shares, Max Drawdown, Time → Find Optimal Hedge
App/website presents you with Optimal Hedge.
Place the trade in your brokerage account (use limit orders).
When to pick which
Puts if you want uncapped upside and can pay a bit more.
Collar if you want lowest net cost, own the underlying, and are fine capping some upside while IV is rich.
Practical settings
Many pros anchor protection at -15% to -25% over 3–6 months.
For broad risk, hedge SPY/QQQ; for idiosyncratic risk, hedge the single name.
Re-scan periodically; you can roll tighter/longer if MOVE refuses to calm down.
Bottom line: MOVE is the fire alarm in the building. You hope it’s a drill; you still head for the stairs. Use the app to set your floor now—then you can keep hunting upside while the bond market hashes out the regime.
If you want to stay in touch
You can follow Portfolio Armor on X.
You can subscribe to our trading Substack/occasional email list here:
And you can download our hedging app here:
