Realizing the generally negative correlation betweenvolatilityand stock market performance, many investors have sought to use volatility instruments tohedgetheir portfolios. In this article, we'll review four ways you can trade the VIX using specific exchange-traded funds (ETFs) and exchange-traded note...
How to trade in the stock market
Joe Fahmy, managing director at Zor Capital, joins the "Investing With IBD" podcast to discuss common missteps investors make when bracing for big news events and the importance of trusting the market action. Plus, we take a look at high-flying AI stocks that need a pullback to be ...
How to Handle Stock Market Volatility: The VIX Casual market watchers are probably most familiar with the VIX method, which is used by the Chicago Board Options Exchange’s Volatility Index. The VIX, also known as the “fear index” is the most well-known measure of stock market volatility....
When there is stock market pandemonium, there tend to be a lot of worst-case scenarios thrown around e.g. zombie apocalypse with no food, electricity, or running water. Because of the hysteria, the stock market tends to both overshoot on the upside and on the downside. ...
Historically, the dividing line between muted and elevated volatility is 20. The VIX is generally low (in the mid-teens and below) when options traders expect the stock market to be tranquil 30 days out. If they expect big price swings, the VIX will typically rise. A VIX above 30 indicat...
How to Win the Stock Market Game. Knowledge is power. The main driving force is the trend. Understand the trend & you understand the market.
Investors often view this indicator as the"fear index"because it spikes when investors purchase a significant amount ofput optionsto protect their portfolios. Investors who buy put options believe the price of the underlying stock will fall. If theVIXspikes, it indicates fear within the market. ...
In the securities markets, volatility is often associated with big price swings either up or down. For example, when the stock market rises and falls more than 1% over a sustained period of time, it is called a volatile market. An asset’s volatility is a key factor when pricing options ...
Trading the market more actively also means knowing when you want to enter and exit trades and stick to a strategy outlined in your investing plan. Don't let the FOMO—fear of missing out—become a factor. "If it's my money being put into the stock market, I want to do a high-conv...