Event risk is starting to take its toll on US equities markets

Jay Soloff

Argonath Financial

Event risk is starting to take its toll on US equities markets. The major indices are sliding for the third day in a row as the US steps up its attacks on ISIS (along with a coalition of allies). In addition, the Treasury's new rules to curb tax inversion deals are hitting the healthcare sector (which has benefited most from the old rules). Headline risk seems to be causing investors some concern, with the VIX edging up above 14. While the volatility index is at its highest level since early August, it's still well below its historical average. On the other hand, the lesser known SKEW index just climbed to its highest level since 1998. SKEW, which measures far out-of-the-money option volatility, suggests investors are concerned about tail risk and are hedging against an extreme move in equities.


Jay Soloff
Jay Soloff
Research Analyst
Argonath Financial

I'm an investments analyst for a US-based independent investment research firm. My focus is on economics, options, and all types of stocks, but especially tech, Internet, and renewable energy companies. I have experience as a options market...

Expertise

No areas of expertise

I would like to

Only to be used for sending genuine email enquiries to the Contributor. Livewire Markets Pty Ltd reserves its right to take any legal or other appropriate action in relation to misuse of this service.

Personal Information Collection Statement
Your personal information will be passed to the Contributor and/or its authorised service provider to assist the Contributor to contact you about your investment enquiry. They are required not to use your information for any other purpose. Our privacy policy explains how we store personal information and how you may access, correct or complain about the handling of personal information.