Investor risk appetite is plunging: The ratio of leveraged long to short ETF trading volume is down to ~1.1, the lowest since the April 2025 “Liberation Day” bottom. This means trading activity in leveraged short ETFs is now nearly equal to that of leveraged long ETFs. By comparison, the indicator reached 3.0 in October, when bullish bets heavily outweighed bearish ones. This ratio is now approaching the 2022 bear market and 2020 pandemic lows, when investors were heavily positioned for further declines. By comparison, this ratio fell to 0.4 at the 2008 Financial Crisis bottom, meaning short ETF trading volume exceeded long ETF volume by ~150%. Is the fear trade becoming too crowded?(The Kobeissi Letter)