When CBOE introduced the CBOE Volatility Index® (VIX) in 1993 it quickly became the world's barometer for market volatility. Since volatility often signifies financial turmoil, VIX is often referred to as the "investor fear gauge."

More than that, VIX is a risk powertool – giving investors the ability to leverage volatility via options and futures traded exclusively on CBOE and CBOE Futures Exchange (CFE®). Here's how:

• The VIX is a benchmark indicator that measures market expectation of near-term volatility conveyed by stock index option prices
• The VIX is based on real-time prices of options on the S&P 500® Index and is designed to reflect investors' consensus view of future (30-day) expected stock market volatility
• VIX options and futures enable investors to trade volatility independent of the direction or the level of stock prices

 

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