Prediction odds have shifted in favor of Bolsonaro and against Lula.
That has been reflected in $EWZ performance and stronger call volumes. GS positioning metrics show a material rebuild in long-BRL exposure.
Call/Put open interest has risen materially in line with recent spot moves and now sits near historical highs.
On the vol surface: the BRL surface is heavily skewed toward $USDBRL puts, with the risk reversal trading at its lowest level since 2020.
The event continues to command a hefty vol premium, broadly in line with the highest weights seen in prior election cycles. But USD call skew has recently collapsed.
That has been reflected in $EWZ performance and stronger call volumes. GS positioning metrics show a material rebuild in long-BRL exposure.
Call/Put open interest has risen materially in line with recent spot moves and now sits near historical highs.
On the vol surface: the BRL surface is heavily skewed toward $USDBRL puts, with the risk reversal trading at its lowest level since 2020.
The event continues to command a hefty vol premium, broadly in line with the highest weights seen in prior election cycles. But USD call skew has recently collapsed.
