By Marc Lichtenfeld When the market crashed in March, a lot of attention was paid to volatility.
Market volatility is the variation of a trading price over time.
The most common way to measure the variation of the price of the broader market is the VIX, which is the CBOE Volatility Index. It measures option prices on the S&P 500.
Volatility is also a tool that you can use to hedge your portfolio or trade for profits.
For example, when volatility (as measured by the VIX) was low last winter, many traders and investors bought calls on the VIX or other volatility instruments as hedges. That way, …read more
