JPMorgan Chase has been using put spreads as a proxy for artificial intelligence (AI) and credit macro hedging, according to a recent tweet. The bank’s analysts have identified a particular put spread on the Healthcare Select Sector SPDR Fund (HYG) that they find attractive due to its relative cheapness in implieds.

The HYG Mar26 79-76 Put Spread is currently priced at approximately 7.5 times the maximum, making it an attractive opportunity for investors looking to hedge against potential market volatility. The chart below shows the relative cheapness of implieds for this spread compared to other put spreads in the market.

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According to JPMorgan Chase, this spread offers a favorable risk-reward profile and is a prime example of how put spreads can be used as a proxy for AI and credit macro hedging. The bank’s analysts believe that the spread’s cheapness in implieds creates an opportunity for investors to benefit from potential market volatility while also providing a hedge against potential losses.

It is important to note, however, that this is just one example of how put spreads can be used as a proxy for AI and credit macro hedging, and there are many other strategies that investors can use to achieve similar goals. Additionally, it is crucial to thoroughly evaluate the risk-reward profile of any investment before making a decision.