Article by: John Waggoner
Published by: USA Today
Date: Aug 2011
“When the stock market dives 300 points, pundits start talking about increased volatility. By that reasoning, a broken arm could be referred to as increased flexibility.
“Thanks to the ever-inventive exchange-traded fund industry, volatility is not just a concept: It’s an investment opportunity. Why you would want to invest in volatility is another question — particularly, since not all the current offerings track volatility that well.
“Wall Street’s main measure of volatility is the CBOE Volatility Index, known as the VIX. Some people also call it the Fear Index, because most people associate big sharp market moves with scary down moves.
“Properly speaking, however, volatility refers to both up and down movements.”
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