Hari Swaminathan – Get to know the VIX Index
THE VIX (“FEAR”) VOLATILITY INDEX
The VIX is one of the most watched indicators in the markets, even by professionals. We take a look at what this index is, Understanding VIX method of computation, and how this Index is interpreted on a day-to-day basis in practical terms. We look at overall market correlations with the VIX since the index was created in the 1990’s. The VIX may be called a Volatility Index, but it acts more like a Fear index in the markets. The key lies in understanding the relationship of the VIX index to the S&P 500 Options.
A high or low levels of VIX impacts all S&P 500 Options as well as individual stocks. This course looks at the example of the financial crisis of 2008 in detail when the VIX levels spiked to unprecedented levels, and the impact it had on Options prices. Every Options trader must watch the VIX index.
There are several other Volatility indexes that track Volatility in the markets, and we cover the important ones. It’s hard to be a good investor if you don’t follow the VIX. Get the complete skinny here, this course is all action!!
What you will master
- Why is the VIX called a Fear Index and why is it feared
- Why is it the most watched index in the market
- How is this calculated
- VIX values and the S&P (non)correlations in the early 1990’s
- VIX values and strong correlations in the late 1990’s and since
- What does a high value of VIX do to Option prices
- Flashback – lets got to 2008 and see what high VIX levels can do
- What is the relationship of the VIX to the VIX Futures
- Why is the Options on the VIX not a good trading vehicle
WHAT’S IN THE COURSE?
- Over 8 lectures and 1 hour of content!
- Learn about the all-important VIX Index
- What does certain levels of VIX mean
- How is the VIX calculated
- What is the relationship between the VIX index and the SPX Index
- How does the VIX measure “fear” in the markets
- What does high VIX levels do to Option prices (see what happened in the 2008 crisis)
- What strategies are ideal in a low or medium VIX environment
- What strategies are ideal in a high VIX environment
- What to watch out for in a high VIX environment
COURSE REQUIREMENTS:
- Basic stock markets and trading knowledge
- Basic Options knowledge
WHO SHOULD ATTEND?
- All stock and Options traders
- A must for any Options trader that trades major indices, ETFs and major stocks
CURRICULUM:
Section 1 – Introduction to the VIX Index
- Lecture 1: Introduction
- Lecture 2: History of the VIX Index
- Lecture 3: Calculation of the VIX Index
Section 2 – Practical analysis and implications of the VIX Index
- Lecture 4: Relationship of the VIX Index to the S&P 500 Options
- Lecture 5: Practical trading examples during a High VIX environment
- Lecture 6: Analysis of the High VIX and Google (GOOG) Options
- Lecture 7: Analysis of the Nasdaq VIX (NVX) and the Russell 2000 VIX (RVX)
- Lecture 8: CONCLUSION: Ideal strategies for different VIX levels
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