Equity Indexes
U.S. stocks have been very volatility this week in response to the news from Iran. Buyers managed to stage a comeback on Monday with the S&P regaining all of the morning's losses. The major indexes are higher on the week with the Nasdaq-100 leading the pack with a weekly gain of nearly 1% thanks to today's rally.
Our volatility metrics are not as confident. S&P 500 CallDex is lower for the week signaling a continued lack of faith in the market's ability to rally. RiskDex continues to climb affirming the market's opinion regarding direction over the next 30 days.
It is important to note that RiskDex is at an extreme level. It measures the ratio of the price of out-of-the-money S&P put prices to the price of out-of-the-money call options. The average index value is 3.75 going back to 2005.
Nasdaq-100 implied volatility is much more optimistic than for the S&P 500 as Nasdaq-100 VolDex is lower (an impressive performance) and while CallDex is lower, so is PutDex.
Equities
The equities we cover are surprisingly mixed with several tech names including MSFT, NVDA, META, and PLTR all up more than 3%.
Volatility for single names is mostly lower in a surprising sign of confidence that the turmoil in Iran will not lead to substantial stock price volatility over the next 30 days. Traders who disagree with that thesis can buy volatility at a discount to Friday's closing prices.
You can learn more about RiskDex at Learn More About RiskDex.
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