When one has to deal with shares you should always know that others are fearful or greedy? To know more about others you should know about VIX which is also called as Volatility index. It is an index that is using range of S&P 500 options to find the level of volatility that is expected in the next 30 days.The Volatility index goes up when there is fear and down when there is “less fear” and that helps us to understand when we should be fearful and when we should be greedy.
VIX give traders a volatility to do trading without having a fear factor like change in price, dividends, interest rates, or limited time which affects regular trading or index options. It helps trading to concentrate exclusively on trading. VIX have become an excellent tool for traders. It helps them in speculating things more easily.
It is calculated from the Call and Put and it is also called as “investor fear gauge”. Now currently in market factors seems to fearful but still it seems that some investors are greedy and so they are trying to increase the share prices though conditions are not good and food and oil prices are increasing.
So experts advice to investors seeing the current inflation one should check Volatility index and also go for long term investments for at least two-three months till the confusion in the markets reduces or market comes to a stable position.