PRESS ROOM
Markets are pricing volatility to remain low in the coming months
Wednesday 06th January '21
The CBOE Volatility Index (VIX) futures curve has come down meaningfully compared to 6 months ago. This means that markets’ expectation of volatility in the first quarter of this year is much lower now than it was back then. It can therefore be posited that markets are not necessarily pricing in major disruption in the handover from Trump to Biden. Markets are also largely unfazed by the rapid rise in virus cases in many places including Europe and the US. This creates a short-term risk of disappointment if economic activity gets stunted in the first quarter.