By Gunjan Banerji
It's eerily calm out there in the stock market.
The Cboe Volatility Index, or VIX, dropped below 12 last week, a nearly five-year low. The gauge, based on options prices tied to the S&P 500, measures expected volatility in stocks and has closed below 20, its long-term average, for 160 days now, the longest stretch since 2018, according to Dow Jones Market Data.
To some investors, the prolonged calm is a sign that tumult may be just around the corner. The idea is that it's been so long without a bout of volatility, that the market may be due for a pullback.
That may be the case. But it's important to remember that market moves can stay muted for very long stretches. For example, from 2016 to 2018, there was a stretch of more than 310 days in which the VIX was stuck below 20. Timing the return of volatility is tough.
This item is part of a Wall Street Journal live coverage event. The full stream can be found by searching P/WSJL (WSJ Live Coverage).
(END) Dow Jones Newswires
June 20, 2024 10:45 ET (14:45 GMT)
Copyright (c) 2024 Dow Jones & Company, Inc.
精彩评论