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
- As China Admits It Lied About Its Local Debt Levels, Local Billionaires Are Quietly Liquidating Their Assets | ZeroHedge
- The Big Four Economic Indicators - Trending Sideways | Financial Sense
- Comex On The Edge? Paper Gold "Dilution" Hits A Record 124 For Every Ounce Of Physical | ZeroHedge
- Tomorrow the Nerds Seek Revenge | iBankCoin.com
- S&P Dares To Go There: Downgrades European Union To Negative Outlook | ZeroHedge
- "No Brainer" AAPL Enters Correction, Down 12% From Recent Highs To 6-Month Lows | ZeroHedge
- ISM Manufacturing Slumps To 3-Month Lows Led By Plunge In Employment | ZeroHedge
The most relevant financial news and articles from the Internets
- Australia urges full probe of doping allegations in... | Business Insider
- Nigerian army frees nearly 180 hostages held by Boko... | Business Insider
- 8 science-backed mind tricks to beat procrastination and do that thing you've... | Business Insider
- Here's the trick to removing 'like' and... | Business Insider
- Here are 8 of the biggist improvements to the US's... | Business Insider
- Amazon's Hit Man | BusinessWeek
- Japan releases master recording of emperor's war-end... | Business Insider