Veteran investor Bill Gross has warned that the US financial markets are experiencing a leveraged unwind, with exchange-traded funds (ETFs) contributing to broad-based selling.
In a post on X (formerly Twitter) on Thursday, Gross said:
The US financial markets are highly levered and that leverage is unwinding without value considerations.
ETFs when sold sell everything.
Still wait for this falling levered knife to hit bottom.
Next week may present opportunities.
— Bill Gross (@real_bill_gross) April 4, 2025
Gross’s comments come amid heightened market volatility, with major US indices facing sharp declines.
His reference to ETFs stresses the potential for indiscriminate selling during periods of stress.
Gross also indicated that he saw potential buying opportunities emerging soon.
“Nxt week may present some opportunities,” he said.He noted that the US financial market is “highly levered” and that leverage is unwinding “without value considerations.”
“Still waiting for this falling levered knife to hit bottom,” he added.
It must be noted that Wall Street faced its biggest storm since the pandemic era as fears of a full-blown recession rattled global investors.
The S&P 500 plunged 6% on Friday (April 4), erasing over $5 trillion in market value over two days, while the tech-heavy Nasdaq entered bear market territory.
