Some big time action in the VIX suggests there may be concerns over a jump in US equities volatility as the summer winds down

Jay Soloff

Argonath Financial

Some big time action in the VIX suggests there may be concerns over a jump in US equities volatility as the summer winds down. A trader purchased 150,000 VIX call spreads expiring in September, for a total premium cost of nearly $13 million. The buyer purchased the September 19 calls while selling the September 28 strike. With the VIX currently trading at just over 12, the fear gauge would have to jump over 60% for the trade to break even. The VIX is often used as a hedging vehicle, so this could be a hedge against a very large long equity portfolio. Or, this simply could be a large, speculative bet that volatility is going to pick up after the summer doldrums. As a point of reference, the 200-day moving average for the VIX is around 14.6.


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...

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