– Glossary

VIX (also \"CBOE Market Volatility Index\")

The VIX gauges expected market volatility over the next 30 calendar days by calculating a weighted average of the implied volatilities of eight OEX calls and puts that have an average time to maturity of 30 days. Extreme high and low VIX readings can provide good contrarian signals, though it actually doesn´ t matter where the reading lies on an absolute basis if it is at an extreme relative to its recent readings. Buy signals often occur as the VIX reverses lower after an extreme peak, while sell signals occur as the VIX moves higher off an extreme bottom.

« Back

CLOSE
CLOSE