ndx

What happened to the skew?

Today was just a follow through from yesterday.  Bond markets get riled, equities are sold, mess ensues, repeat. When VIX gets into the 12 handle (as it did for a while yesterday) the gravity in volatility is still pulling the IV down.  Today the selling was more pronounced, like someone needed to sell.  Many of the big cap names were slammed, most likely to pay for bond positions that were blowing up.  The short Euro trade must be hurting a lot of folks.  Those folks should want some juice.

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Rough Day to Be a Loved Equtiy

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While today's sell off was actually a bit of a 'meh'  there was one group of stocks that really got slapped around today:  Loved Stocks.  I loved stock is a stock that consistently is the most talked about on not only the networks but on Twitter.  Take a look at the performance of some of the most loved stocks:

AAPL: -3%

AMZN: -3%

BABA: -5%

FB: -3%

GRPO: -5%

LNKD: -4%

TSLA: -6%

TWTR: -6%

YHOO: -3%

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VXN is Cheap, VIX is Not

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The VIX is trading around 12, which implies that the market is going to move about .75% a day, if it is priced perfectly.  In the last two days, the SPX has moved about .66% and over the last 10 and 20 days it has moved less than 7%

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Cage match in the NDX

Stocks briefly flirted with new highs today, but look like they will close up for the day.  Slightly better housing news with a non-reaction to Thailand or Ukrainian violence also got the VIX to a 12 close.  I am not saying stocks can't drop, but the case for up to flat is getting better.  Part of the VIX is to forecast volatility in the future and for now there isn't any.

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