Is VIX of any use for SPX ?

[earth_imperator]

I will say this,the VIX is a very good indicator of general,overall market sentiment and a long bet placed right now on the VIX is eventually gonna pay off because you know it's not gonna stay this low forever.

I would suggest to trade VIX options, not any ETFs nor ETF options on vola, b/c as said, IMO ETFs are scam...
And: I think Bollinger Bands is a better indicator...

 

[tomkat22]

I would suggest to trade VIX options, not any ETFs nor ETF options on vola, b/c as said, IMO ETFs are scam...
And: I think Bollinger Bands is a better indicator...

I tried BBs and Keltner channel when I first started trading but found they kinda skewed and biased my perception of the chart I was looking at so I quit using them.And my personality is such I just dont have the patience to do options.

 

[earth_imperator]

I tried BBs and Keltner channel when I first started trading but found they kinda skewed and biased my perception of the chart I was looking at so I quit using them.And my personality is such I just dont have the patience to do options.

Try William's %R together with MACD and BB. (for daily charts, not necessarily for intraday/daytrading).

 

[ETJ]

https://www.benzinga.com/134339/vix-settlement-carpet-bombs-in-the-spx

There are numerous other events you would like to be aware of.

 

[Sekiyo]

The VIX is a derivative of real-time, mid-quote prices of SPX call and put options.
Does a derivative can provide insight on its underlying ? Not sure ...

 

[earth_imperator]

https://www.benzinga.com/134339/vix-settlement-carpet-bombs-in-the-spx

Do you have got another, a better readable, text for this problem?

There are numerous other events you would like to be aware of.

Do you mean VIX or SPX?

 

[earth_imperator]

I will say this,the VIX is a very good indicator of general,overall market sentiment and a long bet placed right now on the VIX is eventually gonna pay off because you know it's not gonna stay this low forever.

Try William's %R together with MACD and BB. (for daily charts, not necessarily for intraday/daytrading).

Yes, VIX has to rise also according to the said indicators:

 

[BMK]

https://www.benzinga.com/134339/vix-settlement-carpet-bombs-in-the-spx

There are numerous other events you would like to be aware of.

That Benzinga article is from 2010.

Seriously?

Whatever that guy is talking about is completely irrelevant today. He's babbling about the sovereign debt crisis in Greece. You might as well be talking about something that happened to the stock market during World War I.

 

[ph1l]

Is VIX of any use for the SPX itself?

Using data from 1993-01-29 through 2014-05-02, I simulated trades on SPY (SPDR S&P 500 ETF Trust) buying on the next trading day's open and selling on the following day's open (prices adjusted for dividends and splits). Then I generated a rule using closing VIX prices from the recent past (downloaded from Yahoo finance).

my $return = undef;
my $R0; my $R1;
$R0 = $R1 = undef;
if ( $vixraw000 > $vixraw002 ) { if ( $vixraw004 >= $vixraw005 ) { $R1  = $vixraw014 - $vixraw012 ; } }
$R0  = $vixraw001 - $vixraw010 ;
if ( $vixraw020 < $vixraw019 ) { if ( $vixraw015 < $vixraw017 ) { $R1  = $vixraw012 - $vixraw002 ; } }
if ( $R0 >= $R1 ) { if ( $vixraw018 < $vixraw000 ) { $return =   1 ; } }

In the rule, scalar variable $vixraw000 is the close of the VIX today, $vixraw002 is the close of the VIX two trading days ago, etc. $return set to 1 means buy the next trading day's open, and sell on the following trading day's open.

The results on out-of-sample data from 2014-05-05 (earliest potential entry 2014-05-06; earliest potential exit 2014-05-07) through 2023-06-14 (last potential entry 2023-06-15; last potential exit 2023-06-16) showed a mean gain 0.0696246518289367%, a median gain 0.134637104444546%, 59.02% winning trades (slippage and commissions not accounted for).

For all of the out-of-sample data, the results would have been a mean gain 0.0447506895195904%, median gain 0.100050025012521%, and 56.08% winning trades.

So, VIX alone as an input can help predict a little better-than-average, per-trade results simulating trading on an asset tracking the S&P 500.

 

[Big AAPL]

Good stuff ph1l