Volatility: Out for Lunch
The VIXY, VIX is taking a break and along with it the iPath S&P 500 VIX ST Futures ETN (VXX) continues to sink to new lows daily. The question becomes will the VIX and VXX bounce back? Should we be afraid or just ignore the warning and buy up everything?
Great 2 second analysis on the state of the VIX comes from Larry Conners at TradingMarkets.com. Here's what he has to say:
Is The VIX Too Low?
A lot has been written recently about how low the VIX is, how it has to go higher, and therefore the market has to drop. The reality is it’s not true.
If you look at the bull market from 1995-1999, you will see a steady rise in the VIX during that bull market run. Higher long-term VIX levels do not equate to lower stock prices.
Also, as you can see from the statistics below, the VIX has spent over half of its time over the past two decades (from 1992 through Tuesday) between 10-20. So the level it’s at today is very, very normal.
This doesn’t mean the VIX won’t spike from here (it certainly can). What it does mean is that those who are saying the VIX has to rise, or the market has to drop, are simply guessing and not looking at the historical facts.
Bottom line: Enjoy the break in volatility Masters, its time to enjoy the ride.
Best of the Blogs
Scanning and identifying the best blog entries every hour
- Kohl's And The Rest Of The Retailers Are In Deep Trouble | ZeroHedge
- The Ebola Epidemic Silver-Lining: IMF Bailouts For Everyone | ZeroHedge
- Frontrunning: September 15 | ZeroHedge
- AND THe NeXT LeHMaN MoMeNT Is... | ZeroHedge
- Newsflash To Fed: 122 Billion Bottles Of Beer On The Wall Is About Asset Bubbles, Not Jobs | ZeroHedge
- Scotland’s Independence Could Hurt British Pound | Financial Sense
- The Perfect (Dollar) Storm – When Currencies Collide Part 2 | Financial Sense
The most relevant financial news and articles from the Internets
- Briton's beheading boosts resolve of anti-IS coalition | Business Insider
- Jets Player Whispers 'Timeout' In Ref's Ear,... | Business Insider
- New head for Portugal's 'good bank' Novo Banco | Business Insider
- N. Korea sentences American to six years in labour camp | Business Insider
- Another Ultra-Right, Anti-Immigration, Anti-Europe Party Had An Awesome Election | Business Insider
- 25 Ways to Make LinkedIn Work for You | BusinessWeek
- Champagne confirms he will stand against Blatter | Business Insider