Despite North Korea, hurricanes, poor earnings, and poor retail sales numbers, it’s tough to get a sustained rise out of the S&P 500 volatility index VIX.
I present a chart and a musical tribute to celebrate this phenomenon.
VIX Just Keeps Gettin’ Harder to Find
This is a sing-along.
VIX just keep getting harder to find
And all your VIX ain’t bringing you peace of mind
Before you find out its too late, girl
You better get straight
No, you don’t need VIX
To help you face the world each day
That road goes nowhere
I’m gonna help you find yourself another way
No, you don’t need VIX (unless you expect to make 400% on VIX calls).
The above link discusses Billionaire bond guru Jeffery Gundlach VIX bet on which he expects to make a 400% or greater return.
I do not know what options Gundlach bought but I suspect he was up close to 100% within a few days, on that last VIX spike that went from 10 to over 17.
I also suspect he is now well underwater on the value of his options, simply due to time decay.
I have seen this play before. It’s easy to think more is coming then it doesn’t. There is still plenty of time left, assuming he has December options.
Mike “Mish” Shedlock