How nervous is the market?
The volatility dashboard shows how much movement the options market expects, how much actually happens and how unusual that is compared with recent years. A barometer from 0 to 100 combines seven indicators.
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How it works
Volatility indices such as the VIX measure how much the stock market is likely to move over the next 30 days, derived from option prices. The same calculation for 9 days to 1 year gives a curve: if it rises with maturity (contango), the market is calm; if the short end is on top (backwardation), there is stress.
Each indicator comes with its percentile rank, the share of days in the chosen period with a lower or equal value. The volatility premium compares expected with realized volatility; it is usually positive because investors pay for protection.
The barometer averages seven components (level, curve shape, premium, realized volatility, volatility of volatility and decline from the high), each as a percentile of the past three years. A table shows how the market did after similar readings in the past; that is a description, not a forecast.
What a result looks like
Sample dataMade-up sample data, no real prices and no recommendation. Calculated with the same methods as the tool itself.
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Own barometer from seven components, each as its percentile rank over the last three years; the barometer is their average. 0 = as calm as it rarely gets, 100 = as turbulent as it rarely gets.
| Building block | Today | Points |
|---|---|---|
| Vol index level | 18.29 | 24 |
| Term structure 30 days / 3 months | 0.893 | 19 |
| Short-term structure 9 / 30 days | 0.879 | 14 |
| Short volatility premium, inverted | 8.96 | 27 |
| Realized volatility | 14.52 | 17 |
| Volatility of the vol index | 80.9 | 23 |
| Decline from 52-week high | 0.0% | 5 |
History
How often the barometer stood where
Share of trading days per tenth; outlined: the last day of the sample data.
What came next
Return of the made-up stock index by the day's barometer quintile, 4,957 observations from 2 Jan 2007 to 31 Dec 2025.
| Barometer | 1 month | 3 months | 12 months |
|---|---|---|---|
| 0–20 · today | +0.6% (57%) | +0.5% (63%) | +7.1% (54%) |
| 20–40 | +0.6% (59%) | +1.5% (63%) | +5.7% (64%) |
| 40–60 | +0.3% (55%) | +1.1% (55%) | +9.5% (73%) |
| 60–80 | +0.8% (54%) | +2.8% (59%) | +11.0% (81%) |
| 80–100 | +2.2% (65%) | +5.8% (72%) | +12.3% (83%) |
| all days | +0.8% (57%) | +2.2% (61%) | +8.9% (72%) |
Average return without dividends, in brackets the share of positive periods. The periods overlap: only about 236 / 78 / 19 periods of 1, 3 and 12 months are independent. Descriptive, not a forecast.
Percentile = share of trading days in the period (5 years) with a value no higher than the current one; below 20% low, above 80% high. Sample data as of 31 Dec 2025.
- Vol index 30 days
- Expected volatility of the stock index over 30 days, from option prices (annualized).
- Term structure 30 days / 3 months
- Below 1: contango (calm market). Above 1: backwardation, i.e. short-term fear is higher than long-term fear.
- Volatility of the vol index
- How expensive protection against jumps in the vol index is.
- Crash index (skew)
- Price of protection against sharp crashes; above 140 is considered high.
- Realized volatility (21 d)
- Actual volatility of the stock index over 21 trading days, annualized.
- Volatility premium
- Vol index minus realized volatility. Positive: options price in more movement than recently occurred (the normal case).
- Correlation vol index / stock index (63 d)
- Usually clearly negative: when the market falls, the vol index rises.
- Distance from 52-week high
- How far the stock index is below its highest close of the past 12 months.
Volatility term structure
Vol indices by maturity: rising means contango (calm), falling backwardation (stress).
| Maturity | Today | A week ago | A month ago |
|---|---|---|---|
| Vol index 9 days | 16.1 | 16.7 | 18.2 |
| Vol index 30 days | 18.3 | 18.0 | 19.5 |
| Vol index 3 months | 20.5 | 19.9 | 20.0 |
| Vol index 6 months | 21.8 | 21.9 | 21.6 |
| Vol index 1 year | 22.8 | 22.9 | 22.3 |
Vol index and realized volatility
Expected versus actual volatility of the stock index over 21 trading days, annualized.
Assumptions: “Sample market” is entirely made up: trading days from 2006 to 2025 with changing volatility, crisis phases and a leverage effect (when prices fall, volatility rises), vol indices by maturity derived from that, no VIX futures. Percentiles over five years, barometer following the tool's methodology.
Frequently asked questions
What is the VIX?
An index that derives the expected volatility of the next 30 days from options on the US stock market, in percent per year. Readings around 12 to 15 are considered calm, above 30 stress. It is often called the “fear gauge”.
What do contango and backwardation mean?
Contango: expected volatility is higher for longer maturities than for short ones, the normal case in calm times. Backwardation: the short-term expectation is higher because investors fear acute turmoil.
What is the volatility premium?
The difference between expected (implied) and recently realized volatility. It is usually positive; when it turns negative, the market is moving more than options had priced in, typical of acute crises.
How is the barometer calculated?
Each of the seven components is compared every day with its values over the past three years (percentile rank from 0 to 100); the barometer is the average. Below 20 means very calm, 80 and above stress. The method is openly documented.
Learn more in the knowledge base
- MethodologyVolatility dashboard: methodology
- ArticleVIX: how to read the stock market's fear gauge
- ArticleVolatility: how much a portfolio fluctuates
- ArticleTail hedging: what put protection costs, when it pays off and what short-vol strategies teach
- ArticleSkewness and kurtosis: why market crashes are more frequent than the normal distribution says
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