What gives? It seems it should be MUCH higher given how much pants-shitting is going on in the market.
The VIX is broken. The US Dollar is new VIX. I just use UUP and buy calls on it. This market really follows the 10 year interest rate.
Price action rules all. VIX is related to hedging. Hedgies can be caught unaware so VIX can take time to catch up.
This is not a massacre by any means. Wake me up when the market tanks 50-70%. That is a long ways off from these levels. Stocks are way overvalued with declining earnings, increasing inventories and layoffs just starting. Inflation is going thru the roof but, hacks on cable TV tell us, it is not so bad excluding food and gas prices. Okay, got it.
In Jan/Feb, people reduced exposure and/or hedged for this amount of drawdown, so VIX in the upper-20s is about right. If/when we go down significantly further, VIX will pop because we'll be beyond most of the hedges. Also worth keeping an eye on how VIX behaves relative to VOLQ.
Am I the only one who missed the “massacre”? in the market? Easy to tell who has never traded a bear market before. You know what the first half of 2022 reminds me of? A slow day in 2008 or 2000.