Adam Warner discusses the reasons behind the low VIX in Barons: Does a Low VIX Signal Danger? It’s not just bullish complacency, it’s also a consequence of the holiday season — low volume and less trading days till January expiration. – Ilene
Courtesy of Adam Warner at Daily Options Report
Yes, a respectable publication agreed to run my VIX-related infomercial. I guested the Barrons Striking Price column yesterday.
Remember all the way back to April 2010? Spring was in the air, the Mets were still mathematically alive in the National League East race, and the VIX (the Chicago Board Options Exchange volatility index) was near 15. The singing birds obscured the approaching clouds, and before you knew it we had Flash-Crashed our way into a Fear blitz.
Slowly but surely we regained confidence. And now just before the winter solstice, the VIX has returned to under 17 for the first time since those heady days. What’s more, other options signals have shown signs of complacency. The CBOE all equity put/call ratio has hovered around .50 and below recently. The 10-day average of the put/call ratio has hit lows last seen in….yes, April.
…..and there’s more. please click thru a bunch of times and stun them with Page Views.
