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View Full Version : Markets extremely bullish... not a good sign...



teknobucks
12-26-2004, 03:49 PM
Markets extremely bullish... not a good sign...

Look at the VIX... lowest volatility in years... very scary.

VIX - CBOE Volatility Index

1) VIX- A volatility index for the Chicago Board Options Exchange, known by its ticker symbol VIX. It is calculated by taking a weighted average of the implied volatility from eight calls and puts on the S&P 100 index.

2)The VIX measures the volatility of the U.S. equity market. Many investors say that if the VIX goes above 35, it signals a bottom in the stock market.

3) VIX and Stock Market behavior: While there are other factors at work, in most cases, a high VIX reflects increased investor fear and a low VIX suggests complacency. Historically, this pattern in the relationship between the VIX and the behavior of the stock-market has repeated itself in bull and bear cycles. During periods of market turmoil, the VIX spikes higher, largely reflecting the panic demand for OEX puts as a hedge against further declines in stock portfolios. During bullish periods, there is less fear and therefore less need for portfolio managers to purchase puts.


http://tinyurl.com/6clh9

teknobucks
12-26-2004, 10:46 PM
some scary stuff.....but quite interesting:

http://www.amanita.at/e/archive/2004e.pdf

teknobucks
12-27-2004, 06:06 AM
http://biz.yahoo.com/ts/041223/10200501_3.html

the other side of the coin.....:?