VIX
a.k.a. Cboe Volatility Index, Fear index, Fear gauge
An index of how much volatility traders expect in the S&P 500 over the next 30 days, often called Wall Street's fear gauge.
The VIX is built from the prices of S&P 500 options. When traders rush to buy protection, options get more expensive, and the VIX rises. Calm markets tend to keep it lower; panics send it soaring, as during the 2008 crisis and the COVID crash of 2020.
Forex traders watch it as a quick risk sentiment reading. A spiking VIX often comes with a stronger yen, Swiss franc and US dollar, and weaker risk currencies. There are VIX-like gauges for other markets too, such as the MOVE for bonds.
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