Castle Securities: Expected systematic funds will become a short force for US stocks.

Scott Rubner of Castle Securities said that institutional investors in fast money may have reached full exposure to US stocks by September, making them more inclined to sell stocks during market downturns. Systematic funds typically determine their risk exposure based on factors such as volatility or momentum, and these funds have been consistently adding to their positions in US stocks since the market rebounded from its low in April. However, Rubner, who is responsible for stocks and stock derivatives strategies, stated in a report to clients on Tuesday that these funds will exhaust their firepower to buy US stocks by the end of August. Castle Securities is trying to identify the mid-term "reversal" threshold that could prompt commodity trading advisors to start selling S&P 500 futures. This level is still below the current spot price of the index. However, as spot volatility increases, this gap has started to narrow in the past week.