How Does the Cboe’s VIX® Index Work?
The Cboe did not create the VIX® as an academic exercise, or as a service to stock market prognosticators everywhere. They created it because they wanted to make money on volatility. It took them two tries, but the Cboe succeeded in developing a volatility index that forms the backbone of a host of volatility products. The Cboe offers some of these products, but other companies have …
