In one of the hearings at the US Senate Committees on Commerce, Science & Transportation, the billionaire investor George Soros said that the craze in getting into oil and commodities based funds and indices reminds him of the craze in dynamic hedging that was so common in 1987 which some say led to the crash of the stock market in October 1987.
His idea is as follows
If the institutions are piling in on one side of the market(long or short), they have sufficient weight due to speculators to balance that. Now if the trend were reversed and the institutions as a group headed for the exit, there would be a crash.
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