The market's biggest investors just traded like they did in 2007

  • Institutional investors — including mutual-fund managers and pension funds — made massive bullish bets on the stock market from late June through the most recent peak in July
  • Net-long positions in stock futures peaked at a level consistent with the tops reached right around the pre-financial-crisis high, and before the selloffs in January and September last year
  • Investors have pared some of their bullish bets over the past two weeks, given the flare-up of recession fears and the market-wide flight to bonds that inverted the yield curve