Herd Mentality in U.S. Stocks Is Making for Wilder Rides in VIX
Recently, daily moves in the VIX have become more out-sized compared to moves in the S&P 500.
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Big moves in U.S. stocks have been so rare lately that when they do happen, the rush to hedge is violent.
Anxiousness among investors has led to unusually large jumps in the Chicago Board Options Exchange Volatility Index, which measures hedging costs on the Standard & Poor’s 500 Index. When calm has been restored, the volatility gauge has dropped just as quickly.