Modifying the Volatility Index by S. Jack Karczewski
ARTICLE SYNOPSIS ...Modifying the Volatility Index by S. Jack Karczewski
Here's the scoop on the volatility index as an analytical tool for identifying extremes in market sentiment.
Every trader and investor recognizes that the stock market has some degree of volatility because clearly, the market does not move in a straight line. However, traders with a certain amount of market experience eventually come to view market volatility as both a positive and a negative. It can be seen as a negative, because volatility is an unknown and unknowable measure of risk - how quickly will a market adjust to the new state o...