The Financial Post reports in its Friday, Feb. 27, edition that the S&P 500 has been range-bound for four months, with investors increasingly paying for protection against a potential downward move. A Bloomberg dispatch to the Post reports that investor mood has shifted as the S&P 500 lingers below 7,000, contrary to breakout predictions. Factors adding to this stagnation include significant sell-offs linked to artificial intelligence, unclear trade policies and elevated geopolitical tensions. Investors turned to derivatives for downside protection as negative signals increased, pushing the put-call skew to a two-year high last week. The normalized two-month skew on the S&P 500 is now at the upper end of its five-year range. When sentiment moves so far in one direction, analysts start to sense a contrarian signal. Citigroup analyst Stuart Kaiser says: "We've seen a tremendous amount of flow into very short-term tactical hedges. ... Equity markets haven't significantly responded to most geopolitical events. If the Iran risk settles, a lot of risk premium would get compressed out of the market and the investors that have been corralled on the sidelines would start to engage to the upside."