VIX Volatility Index Falls to Lowest Level in Over a Year; Traders Cite Near-Record Stock Prices, Low Rates
The stock market's fear gauge has fallen to its lowest level in more than a year, as investors drop their bets on large stock swings.</br></br>The Chicago Board Options Exchange Volatility Index, or VIX, hit a 14-month low on Thursday of 11.68 before closing at 12.03.</br></br>The index, an options-based measure of traders' expectations for price swings in the S&P 500, is widely viewed as a proxy for the stock market's capacity for sudden spikes and plunges.</br></br>Many traders say they detect little fear in the market lately. They cite a financial outlook that is widely perceived to pose little risk of an economic or market downturn: near-record stock prices, low interest rates, steady if unspectacular U.S. growth and expansive if receding Federal Reserve support for the economy and financial markets.</br></br>The VIX's three-month average this week hit 14.1, a level, before 2013's stock rally, last consistently seen in 2007. In the past 10 years, the VIX has averaged 20.08, including a 2008 financial-crisis spike above 80 and a 2011 euro-crisis jump to 48.