Understanding the VIX – The Fear Index in Stocks

Videos
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/

? GET MY FREEBIES

Freebies

? SUBMIT A VOICE QUESTION

Question – Hungry for Returns

? START HERE: FOR NEW TRADERS

Start Here – for New Traders

? START HERE: OPTION TRADERS

Start Here – Option Traders

? MY CHARTING TOOLS + BROKERS
https://tradersfly.com/go/tools/

? MY COMPUTER EQUIPMENT

Resources: Computer Gear

? GET THE NEWSLETTER

YouTube Newsletter Signup

? SEE OUR MEMBERSHIP PLANS
https://tradersfly.com/go/members/

? STOCK TRADING COURSES
https://tradersfly.com/go/courses/

? STOCK TRADING BOOKS:
https://tradersfly.com/go/books/

⚽ GET PRIVATE COACHING

Coaching for Stock Traders

? WEBSITES:

Home Version 2.0

Home Page

Homepage 2.0

Home


https://sashaevdakov.com

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

⚡ SUBSCRIBE TO OUR YOUTUBE CHANNEL
https://tradersfly.com/go/sub/

? 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
TradersFly is a place where I enjoy sharing my knowledge and experience about the stock market, trading, and investing.

Stock trading can be a brutal industry, especially if you are new. Watch my free educational training videos to avoid making big mistakes and just to continue to get better.

Stock trading and investing is a long journey – it doesn’t happen overnight. If you are interested to share some insight or contribute to the community we’d love to have you subscribe and join us!

Products You May Like

Leave a Reply

Your email address will not be published. Required fields are marked *