Understanding the VIX – The Fear Index in Stocks

The VIX is known as the fear index because it is based on the amount of puts that are purchased.

Why?
-The more puts that are purchased on the SP500, the higher the VIX
-When puts are high that means people are buying protection
-They think the market is going down

High v. Low VIX
-High VIX versus low VIX is relative
-It depends whether you’re looking at historical or implied relativity, a high VIX can’t necessarily be determined by its numerical value
-The implied VIX is the state that you are currently in
-Remember: when the VIX is high, it’s time to buy; when the VIX is low, look out below
-The VIX works opposite of the market (but it’s not always 1:1)
-When the VIX is high, stock prices go down because fear impacts selling to the negative side
-When the VIX is low, stock prices start to increase because there is less fear, which means stocks will eventually tumble
-It shows you how much protection people are buying with the puts

#understandingvix #stockfear #fearindex #vixindex #marketvix

Posted at: https://tradersfly.com/blog/vix-the-fear-index-in-stocks/

???? Newsletter & Announcements : https://tradersfly.com/go/tube/
???? Discord Group: https://tradersfly.com/go/discord/
???? Freebies: https://tradersfly.com/go/freebies/

???? Start Here: https://tradersfly.com/go/start/
???? Options Basics: https://tradersfly.com/go/start-options/

ONE-ON-ONE COACHING & MENTORING :::
⚽ Coaching: https://tradersfly.com/go/coaching/
???? Options Mentoring (4+ Months) https://tradersfly.com/go/mentoring/

PRODUCTS ::::
❤ Courses: https://tradersfly.com/go/courses/
???? Books: https://tradersfly.com/go/books/
???? My Tools: https://tradersfly.com/go/tools/
???? My Equipment https://backstageincome.com/go/computergear/

???? SOCIAL MEDIA:
https://tradersfly.com/go/twitter/
https://tradersfly.com/go/facebook/

???? MY YOUTUBE CHANNELS:
TradersFly: https://backstageincome.com/go/youtube-tradersfly/
CriticalCharts: https://tradersfly.com/go/criticalcharts/
BackstageIncome: https://backstageincome.com/go/youtube-bsi/
MyLittleNestEgg: https://mylittlenestegg.com/go/youtube/

???? WEBSITES:

Home Version 2.0

Home Page


https://criticalcharts.com

Home

Homepage 2.0

Home

???? SOCIAL MEDIA:
https://tradersfly.com/go/twitter/
https://tradersfly.com/go/facebook/

???? MY YOUTUBE CHANNELS:
TradersFly: https://backstageincome.com/go/youtube-tradersfly/
BackstageIncome: https://backstageincome.com/go/youtube-bsi/
MyLittleNestEgg: https://mylittlenestegg.com/go/youtube/

???? ABOUT TRADERSFLY
Tradesfly is focused on me sharing my experience and knowledge about trading options. Although we include videos related to other areas of trading, the primary focus is trading options. If you are serious about learning to trade options for selling premium, creating spreads, be sure to subscribe to the channel and join our discord group.

???? DISCLAIMER
All of the stocks mentioned in this video along with any other videos we have are opinions and not investment, financial or legal advice. These videos are for general education, information, and entertainment. Do your own due diligence and consult with a registered financial advisor before taking any position since everyone has a different risk tolerance.


Posted

in

by

Tags: