Popular Zero-Day Option Strategies Keep Lid on Stock Rallies (1)

Investors’ daily waves of option sales are poised to slow a sustained stock rally back to record highs.

Option-selling strategies have abounded in 2025, from exchange-traded fund overwrites to systematic zero-day to expiry trades and bank Quantitative Investment Strategies. On the other side, the dealers typically rebalance their positions each day by selling into rallies and buying dips.

The slowing effect may be felt more on gains than drops, as JPMorgan Chase & Co. strategists led by Bram Kaplan noted an increasing preference for selling calls over puts in recent weeks. Meanwhile, UBS Group AG points to a particular strategy ...