VIX Today — Current CBOE Volatility Index & Fear Gauge

What is VIX?

The CBOE Volatility Index (VIX) measures the market's expected 30-day volatility of S&P 500 index returns, calculated from the prices of out-of-the-money S&P 500 index options. Often called the "fear gauge," VIX is expressed in annualized percentage points: a reading of 20 implies the market expects the S&P 500 to move roughly 20% (one standard deviation, annualized) over the next year, or about 5.8% over the next month. VIX is computed in real time by Cboe Global Markets and the FRED series VIXCLS publishes the daily close. Historically, VIX has averaged around 19, with quiet markets reading in the low teens and crisis episodes (2008, March 2020) spiking above 80. VIX is mean-reverting — it does not trend — and tends to move inversely to the S&P 500 with a sharp asymmetry: it rises faster on selloffs than it falls on rallies. Term structure of VIX futures (contango vs. backwardation) provides additional regime information beyond the spot level.

Why VIX matters for stocks

High VIX (above ~25) signals stress and historically marks attractive entry points for long-term equity investors, though near-term drawdown risk is real. Low VIX (below ~13) signals complacency and often precedes drawdowns. VIX-sensitive strategies include short-volatility funds, which collect premium in calm regimes but suffer outsized losses on spikes, and tail-risk hedges, which underperform until they don't. Equity sectors react differently: low-VIX environments favor growth and high-beta names; high-VIX environments reward quality, defensives, and balance-sheet strength. Currency and credit markets also key off VIX as a global risk-on/risk-off signal.

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