Billionaire hedge fund manager Paul Tudor Jones has built an $8bn options position tied to the Russell 2000, signalling growing expectations of heightened volatility across US small-cap stocks.
According to Tudor Investment Corp’s latest 13F filing, the firm disclosed a $5.1bn put position and a roughly $3bn call position linked to the iShares Russell 2000 ETF (IWM), creating one of its largest macro trades of the quarter.
The structure of the trade suggests Jones is positioning for a significant market move in either direction, rather than making a purely bearish call on equities. Analysts say the combination of puts and calls resembles a volatility strategy centred on small-cap stocks, which are often viewed as more sensitive to interest rates, financing conditions and domestic economic growth.
The filing also revealed options exposure tied to major technology names including Nvidia, Amazon, Microsoft, Meta and Tesla, alongside positions linked to regional banks, energy and broader financial sectors.
Jones has recently warned that equity markets could face a “breathtaking” correction over the next two years, although he remains constructive on the long-term outlook for AI-related investments.
Market observers say the positioning reflects growing concern among macro investors over elevated valuations, inflation risks and the increasing concentration of gains among a small number of AI-driven technology stocks.
