The Volatility Index (VIX) is surging of late and this is leading some to suggest that volatility may be topping out at the same 40 range where it peaked in the Asian contagion crisis of 1997 and the 9/11 attacks and that this may suggest a bottom for this most recent stock market correction.
This is possible; however we think it relevant to note that the VIX hit its all time peak in November 2008, and then fell about 50% to March 2009. Over this same time the S&P 500 lost a further 38% before bottoming. Food for thought…
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