I did not record the timestamp on that snapshot but I believe it was 15 minutes or so before the close.

As of 3:03 PM the S&P rallied back towards even as did the VIX. Curious behavior to say the least.

What's Going On?

I don't know, but here are some theories.

  1. Hedge funds and pension funds doubling up on short volatility trade.
  2. Manipulation against Mr. 50-Cent VIX.
  3. Pure complacency. No one wants PUTs.

Points 1 and 3 are more likely.

Short Volatility Trades

RECOMMENDED ARTICLES

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I wrote about short volatility trades twice recently.

November 7: Expect a Volatile Future: Short-Volatility Funds Flooded With Cash

December 6: "Everyone in the Room is Selling Volatility"

"Volatility was once just a measure. Now it's an income-generating product. Everyone is selling it says Pennant Capital."

These short-volatility pension fund managers will get blown out of the water one day.

Mike "Mish" Shedlock

Volatility Spikes, Equities Smashed: Congratulations Mr. 50-Cent VIX

A trader dubbed "Mr. 50-cent VIX" because he likes to buy masses of options priced near 50 cents, hit it big today.

Nasdaq Down 5%, DOW and S&P Down Over 3%: Just a Start

The FANGs led the Nasdaq on the way up and lead again on the way down. Technology shares were hammered close to 5%.

Crypto Bloodbath Amid Widespread Equity and Bond Carnage: VIX Breakout

The cryptocurrency selloff continued along with strong pullbacks in equities and bonds. The VIX is on the rise.

VIX Elephant Poised to Lose $20 Million Escapes With $2 Million Loss

A VIX spiked today enabled a trader known as the "50 Cent Elephant" to escape his VIX bet with minimal losses.

Mr. 50-Cent VIX Nets $200 Million

Mr. 50-Cent Vix made $400 million on his recent bet, but he was down $200 million for 2017.

Mr. 50-Cent VIX Strikes Again

A person or fund has been making enormous bets on VIX calls priced near 50 cents. The CALL volume spiked again Friday.

First Victim Announced: A $300M VIX Fund Goes Poof

Congratulations to Nomura Europe Finance for being first across the finish line in the VIX self-destruction contest.

Vanishing Vix Musical Tribute

Nothing seems to phase the stock market for more than a day or two.

Apple Cites "Mounting Uncertainty": APPL Down 7% AH, Nasdaq Futures Down 2.3%

Apple Blames "Mounting Uncertainty" in Rare Guidance Cut. Futures hammered.