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Welcome to your source for answers to questions about option concepts, strategies, and terminology. A new question and answer is published each week. To view the Ask the Institute archives, click the "Ask the Institute Archive" link below.

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This week's question:

DATE: October 2, 2015

I don't trade volatility, why should I care about VIX®?

VIX is commonly referred to as 'the fear index'. VIX levels can be used as an indication of how concerned market participants are regarding the future direction of the stock market or S&P 500®. It may also be used as an indication of how complacent market participants are with respect to the risk of owning stocks. To learn more view this segment of "Ask the Institute."