The Australian share market continues to crater in afternoon trade.
With the market now down well over 1%, the ASX200 Volatility Index (VIX) has unsurprisingly shot higher.
Today’s result means that the ASX200 VIX is now at its highest level since the US elections last November.
The S&P/ASX 200 VIX is primarily used as an indicator of investor sentiment and market expectations, and is calculated using prices for put and call options traded on the ASX.
A volatility index at relatively high levels generally implies a market expectation of very large changes in the S&P/ASX 200 over the next 30 days, while a relatively low volatility index value generally implies a market expectation of very little change.