Volatility Trading: The Market Tactic That’s Driving Stocks Haywire | WSJ

by News Update

The pandemic has fed investors’ appetite for volatility trading, a market tactic that allows traders to bet on big market swings. But analysts say these bets have grown so popular that they’re driving more volatility, making the markets riskier for everyone. WSJ explains. Image: Jacob Reynolds

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32 comments

S M June 25, 2020 - 10:07 PM

First

Hype Joey June 25, 2020 - 10:07 PM

No likes. No dislikes. And I will be the first to like

Abdul Aziz June 25, 2020 - 10:09 PM

first

solli mika music June 25, 2020 - 10:09 PM
solli mika music June 25, 2020 - 10:09 PM
Sanjaya Ariyawansa Education June 25, 2020 - 10:13 PM

Insightful Video

Dennis Johnson June 25, 2020 - 10:14 PM

Where do you draw the line on such derivatives?

Numan M. Yass June 25, 2020 - 10:14 PM

Volatility trading basically means
Take the money and RUN ?‍♂️

David Liang - College Grad Finance June 25, 2020 - 10:16 PM

Everyone wants to make a quick buck!

domtorque June 25, 2020 - 10:16 PM

WSJ is a sellout

private policy June 25, 2020 - 10:28 PM

Volatility shows indecision in the market and now is the time that investor aren't able to decide where to park thier fund …. So volatility steps such a huge high in this pandamic ..

Henry li June 25, 2020 - 10:31 PM

Pure gamble.

XtarShoter June 25, 2020 - 10:39 PM

Volatility isn't an investment

Eli Cusick June 25, 2020 - 10:41 PM

TVIX was just de-listed, very interesting as to possibly why.

Leonard Eisen June 25, 2020 - 10:43 PM

I'm just here so I can understand why the next recession is gonna happen.

Financial Shinanigan June 25, 2020 - 10:46 PM

If you think of investing as marriage, people wouldn't be trading in and out like they are now.

Winston Jones June 25, 2020 - 10:58 PM

Please stay out of UVXY if you are not an experienced investor. I learned the hard way recently.

Larry E June 25, 2020 - 11:02 PM

I’m a volatility trader and I haven’t lost any money this year.

Peter June 25, 2020 - 11:17 PM

We need to cancel volatility

Longchicken June 25, 2020 - 11:22 PM

The huge bubble will pop soon.

Saisravan Satturu June 25, 2020 - 11:33 PM

When private equity hedge funds gets more influence in financial markets that stock market gets more volatility

Jorish Nathanael June 25, 2020 - 11:42 PM

Hello forex

justforlaughs June 26, 2020 - 12:00 AM

Been shorting since February, so far so good! A few downs tho. Or rather say a few ups LOL!

bLv Dinh June 26, 2020 - 12:12 AM

Some people will go deaf at 4:15.

karishma malhotra June 26, 2020 - 12:31 AM

nice

yariel londono June 26, 2020 - 12:44 AM

The dealer will eventually deal himself a blackjack and wipe everyone out at the table. Take your chips and go have a drink by the bar for now. The shoe (2020) will not be favorable for most. Same concept with the markets.

Sleekoduck June 26, 2020 - 1:11 AM

This reminds me of the junk bonds in the 1980s and the high risk mortgage funds earlier this century.

Ndar June 26, 2020 - 1:19 AM

This type of trading in which most people don't understand what they are doing is what causes most US crisis and make countries with heavy trading with the USA suffers from time to time.

Aman C June 26, 2020 - 1:59 AM

Good piece but not the correct explaination, basically VIX is not directly investable but there are ETFs linked to VIX index which has a convexity in returns that means downside is limited if you buy it in a stable market when VIX is between 14 to 20 but upside is unlimited with high probability of large gains which creates asymmetrical returns. These investments are mean reverting that means you cant buy and hold in the long run, you sell it as soon as you reach your return target. The huge risk comes in when you have direct exposure through short positions which can create huge losses. Hope this helps

Eugenio Renaldo June 26, 2020 - 2:34 AM

Strange how Daddy's girls are always happy when they know they're being watched even when talking about something so dramatic for regular folks.

hardlyb June 26, 2020 - 3:07 AM

My strategy is to stockpile canned dogfood and hope for the best.

ClaxtonBay123 June 26, 2020 - 3:53 AM

Is this Joanna Stern's voice? She's carrying WSJ on her back right now.