Barron’s (March 6)
“The Nasdaq Composite closed in correction territory as Wall Street sold pretty much everything in response to the Trump administration’s latest tariff rhetoric.” Both the S&P 500 and the Dow also dropped amid a tariff saga that has left investors shaking. “The uncertainty surrounding Trump’s tariff plans have caused headaches for market participants. There are also fears among some economists that policy uncertainty will send sentiment falling further until it triggers a recession.”
Tags: 2020, Capitulation, Escalation, Fears, Havoc, Market, Panic selling, Recession, Sparking, Stocks, Tariffs, Trade war, Trump, U.S., VIX, Volatility, Worst week, Wreaked
Bloomberg (October 27)
“The VIX is at 20, stocks are on the brink of their worst October in five years, and every other day the bond market throws a fit. For equity bulls conditioned to dive in at any sign of weakness, it’s getting to be too much. Across investor categories, they’re pulling money out” and moving to a defensive posture.” But “from a contrarian standpoint, all the gloom is a positive, suggesting latent buying power should sentiment ever flip.”
Tags: Bond market, Buying power, Contrarian, Defensive posture, Equity bulls, Fit, Gloom, Investor, Latent, October, Positive, Sentiment, VIX, Weakness, Worst
Institutional Investor (April 4)
On February 5, after a placid 2017, “the VIX surged from the previous trading day’s close of 17.3 to 37.3…the largest daily percentage increase in the three-decade history of the index, more than doubling in one day.” Some investors have been overreacting to the detriment of performance when they should be simply tuning out the noise. “Volatility can create a risk: that we reduce our market exposure at the point of maximum psychological pain; in other words, we sell at the bottom…. Sometimes the best thing we can do is simply nothing.”
Tags: Bottom, Investors, Market exposure, Overreacting, Pain, Performance, Risk, Sell, VIX, Volatility
Institutional Investor (March 19)
Volatility divides. Too much and it can be catastrophic. Too little and returns shrivel.” Increasingly investors are moving beyond hedging volatility to “trading volatility itself.” While specialists have been doing this for some time, trading volatility has “become more mainstream” since 2008 and the “go-to tool” many investors use to trade volatility is now “the VIX itself.”
Tags: Catastrophic, Hedging, Investors, Mainstream, Returns, Trading, VIX, Volatility
