RE: The Fear Index24 Sep 2023 11:19
Troajan baltic dry index
I do remember you posting about that index recently!
According to this snippet October could see volatility
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A New Wave of Stock Market Volatility Could Be Right Around the Corner. What to Do.
Published: Sept. 20, 2023 at 1:30 a.m. ET
By Steven M. Sears
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To profit from the anticipated disruption, Goldman Sachs has advised clients to consider buying October call options on the Cboe Volatility Index. SPENCER PLATT/GETTY IMAGES
The world is on the verge of a volatility eruption. At least that’s what Goldman Sachs is telling its clients.
Many investors already feel that they are making financial decisions amid heightened macro-risk factors that are concealed by the languid, range-bound nature of markets.
But looming geopolitical risks, the continuing efforts of central banks to reduce inflation without sparking economic recessions, and the threat of a U.S. government shutdown can be easy to dismiss until something volcanic occurs that removes all doubt.
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The impetus for a rerating of risk—and a potential decline in stocks and an increase in options volatility—could arrive in October, according to John Marshall, Goldman’s derivatives strategist.
Marshall wrote in a recent note that options volatility for the S&P 500 index has spiked an average of 27% from August to October for the past 95 years. He also found that average realized volatility in October was markedly higher than the average of other months over the past 95 years for the S&P 500, and over the past 40 years or more for the Nasdaq 100 and the Russell 1000 and 2000 indexes.
His strategy team consequently has told clients to be cautious on selling options—a perennially popular trade—due to seasonal increases in volatility and a heavy corporate calendar for earnings reports and other financial updates.
In October, Marshall noted, corporate management teams are under heightened pressure to meet full-year earnings expectations because time is running out. Investors who manage money for other people also confront the tyranny of time. If they have failed to satisfy annual performance goals, they are under intense pressure.
Those two forces can make October unforgiving for any company that fails to impress when reporting earnings, hosting investor-day meetings, and issuing financial guidance for the coming year. Market volumes reveal the ferocity of investor reactions.
“Indeed, shares and single stock options volumes over the past 26 years have peaked in the month of October on average, with especially
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