How To Make Money During Market Swings

The volatility index, also known as the VIX, is a forward-looking index, measuring implied volatility based on S&P 500 options. The VIX spikes during times of uncertainty, and there's complex mathematical equation at the core of the calculations. Investors may use the VIX to help them make investment decisions. Watch the video above to learn more about how the VIX measures fear, the mechanics behind implied volatility and why it matters to investor portfolios.

The volatility index, also known as the VIX, essentially takes a reading of the stock market’s blood pressure, measuring investors’ fear.

The VIX can spike when investor concerns are heightened by events like the raising of interest rates by the Federal Reserve or the Covid-19 pandemic.

“It’s just a unique tool that we can actually quantify that [concern],” Lindsey Bell, chief markets and money strategist at Ally Financial, told CNBC.

The VIX is a forward-looking index that weighs volatility based on trading in S&P 500 options.

“It’s measuring implied volatility over the next 30 days, and that’s derived from option activity,” said Jason Snipe, founder and chief investment officer at Odyssey Capital Advisors. “That’s the catalyst for what moves [the VIX] in either direction.”

Investors can use the VIX to help them make buying and selling decisions, or they can indirectly invest in it.

“The most important thing is having a plan for whatever you are investing for, whether you are a trader or an investor,” said Tiffany McGhee, chief investment officer and CEO of Pivotal Advisors.

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How To Make Money During Market Swings

[hehehe]

CNBC has awesome videos tbh. I am so impressed with their quality! Well done CNBC, you guys are doing an amazing job!!

[Paul-tbtd]

When it comes to investment, diversification is key. That is why I have my interests set on key sectors based on performance and projected growth. They range from the EV sector, renewable energy, Tech and Health.

[Discovery_and_Change]

5:53 VIX over 30 is considered large volatility
6:00 VIX under 20 means market is complacent
7:09 You can indirectly invest in the VIX

[emilyfranklin]

It's true - I'm still at the beginning but trying to learn all I can to figure out the best focus I should have to invest in myself through crypto. Consistancy is something I need to do for sure - the hard part is seeing exactly where my focus should be! Back to the basics with DCA I guess and then just keep working on my other ideas and learning all I can!

[timsherwood]

Believe this at your own peril. This is a zero sum game. Make more thorough researches before investing or better still, get a fin. advisor. Made my first million earlier this year through one after losing a fortune to YouTube inspired "trial and error" investments. This game is no joke...

[katelynrenesse]

I leverage on the volatility of the market for significant returns rather than holding and loosing value to the volatility of the market I made my first mill from going diverse, mainly stocks, ETFs, few Cryptocurrencies and bonds. thankful to my now financial advisory Rita Wildrin Mora. It’s a long term plan for me so I invest and re-invest. building wealth involves developing good investment habit and understanding.

[christianaragon]

I'm starting to feel it's a risky time to be in the stock market, at the same time, I feel its a good time to look out for opportunities. I still hear people saying they are getting ahead with their portfolios. But I am very afraid of the 80% stock crash that has been announced by many investment channels. Help!

[henrymaverick]

Great video! But im not so convinced that Bitcoiners want Ethereum to fail. I feel BTC and ETH have a symbiotic relationship. If ETH has an amazing POS transfer, it could be good for the whole crypto market. They're two completely diff blockchains for diff purposes.I have learned from you and other Youtubrs especially my mentor Ivana Marich who taught me how to make trades and increase my crypto daily, ive went from 4 btc to over 12 btc in few weeks.

[NHJDT]

There's too many zombie companies right now. Reminds me of when the tech bubble popped 20 yrs ago. Real physical commodities broke out of their patterns and ready for a new bull market. Silver, oil, food, uranium, platinum, gold. Choose a commodity

[inigobantok]

This is a good prep talk in investing based on volatility index in sequence of current events but I thought they are gonna explain the vix formula itself.

[ameliagarcia]

When some people think of successful stock traders, they think of multimillionaires lounging in a beach town, making trades and relaxing. That reality is rare, and stock trading isn't as easy or lucrative as it might seem from the outside. Despite challenges, some people elect to stock trade as a part-time job, or they take on stock trading as their full-time gig. If you know your stuff and follow a strategy, you can make money over time through stock trades by adopting the signal of a licence broker

[tholam]

Would the VIX be like a delayed 'self-fulfilling prophecy' index or how do they mitigate that for investors choices from reading the VIX so that it does not compound in the final indicator number?

[tira]

It's just a matter of time before the government say's that you have to much money in investments. You know, it's just not fair. We are going to take 40-75 percent and give it to more deserving people. And this would happen under both parties.

[kelvinwu]

I will forever be indebted to you, you've changed my whole life and i continue to preach about your name for the world to hear you've saved me from a huge financial debt with just little investment, thanks so much Mrs Megan Tracey.

[sashasavisha]

When does the market not bounce back? Never. Also you should be able to invest your own money, unless you just don’t have the time or interest. It’s not hard though. Listen to the experts. CNBC is a good source of information.

[georgeheyden]

I will forever be indebted to you, you've changed my whole life and i continue to preach your name to the whole world to hear you've saved me from a huge financial debt with just little investment, Thanks so much Mrs Paula David.

[seanlasser]

The only way to use the market nowadays because of Algo complexity is options. I don't trade but live in an area in NJ known as the "Goldman getto" locally. If you're not in a seat but want to trade that's apparently the only way to do it without getting destroyed.

[frankiel]

They all just keep repeating what they are saying.. 1) Vix is a measurement volatility. 2) when there are abnormal price movement, there are volatility. OK… thanks….

[shresthadipen]

I think uvxy and sqq are also measure the volatility of the market.

[zenosiculi]

In my opinion vix etf is not good as an asset that is inversely proportioned to stocks, it is more like speculation in the short term.