What Is the $Cboe Volatility Index(VIX)$?
The Cboe Volatility Index (VIX) is a real-time index that represents the market's expectations for the relative strength of near-term price changes of the S&P 500 Index (SPX). Because it is derived from the prices of SPX index options with near-term expiration dates, it generates a 30-day forward projection of volatility.1 Volatility, or how fast prices change, is often seen as a way to gauge market sentiment, and in particular the degree of fear among market participants.
The index is more commonly known by its ticker symbol and is often referred to simply as "the VIX." It was created by the Cboe Options Exchange (Cboe) and is maintained by Cboe Global Markets. It is an important index in the world of trading and investment because it provides a quantifiable measure of market risk and investors sentiments.
The Cboe Volatility Index, or VIX, is a real-time market index representing the market's expectations for volatility over the coming 30 days.1
Investors use the VIX to measure the level of risk, fear, or stress in the market when making investment decisions.
How Does the VIX Work?
The VIX attempts to measure the magnitude of price movements of the S&P 500 (i.e., its volatility). The more dramatic the price swings are in the index, the higher the level of volatility, and vice versa. In addition to being an index to measure volatility, traders can also trade VIX futures, options, and ETFs to hedge or speculate on volatility changes in the index.
To put it in simple terms...
The higher the fear, the higher VIX will go and majority of stocks will crash. The market will most probably crash when fear levels are high. Let's pray that the economy will take a better turn so the market doesn't collapse. May we have world peace [Comfort]
Watch the index, volume and do your due diligence. Don't blindly follow rumours and hype.
Be safe.
Bloodbath is real.
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