The warnings that have proliferated about market complacency have done nothing to stop the so-called fear gauge, which fell to a 23-year nadir of 9.77 on May 8; and closed in single digits on four days last month for the first time since December 1993. The Chicago Board Options Exchange’s Volatility Index averaged just 10.86 in May, the lowest level since the measure began in 1990. Meanwhile, as Deutsche Bank AG point the finger at hedging by large banks to explain the VIX’s collapse and Allianz SE’s Mohamed El-Erian frets about leveraged investors, the S&P 500 Index kept hitting record highs.
Source: Bloomberg Pro Terminal
Jr Trader Alexander Kumanov
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