High-Risk Regime’s 6-Month Anniversary

High-Risk Regime’s 6-Month Anniversary

We are more than 1/2 a year since the August stock market crash, sometimes known as China’s Black Monday. And in our “flipping volatility regimes” article last month, we argued that the risk regime was statistically higher and endured that way, after the August tumult then snapback. During this past 6 months, the volatility index has averaged ~20%. Nearly four percentage points greater than its average during the 6 months before that! Today the market’s volatility has dropped to a close below 15%, something seen only 10 times in the past 125 trading days (6 months).

This post was published at Zero Hedge on 03/17/2016.