Glossary
VIX
Cboe's volatility index, computed from S&P 500 option prices, measuring the market's expected 30-day volatility; often called the fear gauge.
On this page
The VIX is the Cboe Volatility Index, a real-time number that expresses how much the S&P 500 is expected to swing over the next 30 days, as implied by the prices of S&P 500 index options. It is quoted in annualized percentage points: a VIX of 20 means option prices imply about 20% annualized volatility. Because it usually jumps when stocks fall and investors rush to buy protection, it is nicknamed the market's "fear gauge."
How it works
Cboe computes the VIX from the prices of a wide strip of out-of-the-money SPX puts and calls with near-term expirations, blended to a constant 30-day horizon. The more traders pay for options, the higher the index. It is a measure of implied volatility, not of how much the market has actually moved.
Reading it
The VIX tends to sit in the low-to-high teens in calm markets and spikes during crises. Its record close was 82.69 on March 16, 2020, during the pandemic sell-off; during the 2008 crisis it topped 89 intraday. High readings tend not to last, which is why the VIX is said to be mean-reverting.
You cannot buy the index itself. VIX futures, options and the exchange-traded products built on futures behave very differently from the spot index, and products that hold rolling futures have historically lost value over time when the futures curve is in contango. A low VIX describes current calm, not a guarantee against a sudden shock.