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
More from the Wall Street Journal:
Visit WSJ.com:
Visit the WSJ Video Center:
On Facebook:
On Twitter:
On Snapchat:
#WSJ #Economy #Explainer
32 comments
First
No likes. No dislikes. And I will be the first to like
first
https://youtu.be/_7kDfrgTXpc
https://youtu.be/PcOoy5w9XKU
Insightful Video
Where do you draw the line on such derivatives?
Volatility trading basically means
Take the money and RUN ?♂️
Everyone wants to make a quick buck!
WSJ is a sellout
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 ..
Pure gamble.
Volatility isn't an investment
TVIX was just de-listed, very interesting as to possibly why.
I'm just here so I can understand why the next recession is gonna happen.
If you think of investing as marriage, people wouldn't be trading in and out like they are now.
Please stay out of UVXY if you are not an experienced investor. I learned the hard way recently.
I’m a volatility trader and I haven’t lost any money this year.
We need to cancel volatility
The huge bubble will pop soon.
When private equity hedge funds gets more influence in financial markets that stock market gets more volatility
Hello forex
Been shorting since February, so far so good! A few downs tho. Or rather say a few ups LOL!
Some people will go deaf at 4:15.
nice
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.
This reminds me of the junk bonds in the 1980s and the high risk mortgage funds earlier this century.
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.
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
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.
My strategy is to stockpile canned dogfood and hope for the best.
Is this Joanna Stern's voice? She's carrying WSJ on her back right now.