The VIX is considered the market's fear gauge and reflects future volatility over a monthly time span. VIX call strikes are typically attractive to traders when they think an intense leg lower is coming.
"The coronavirus has injected what we would classify as an 'unknown unknown' set of fears," Looney added. "This is a very fluid situation." His observation comes from the market's front lines, where he helps facilitate trades on behalf of large institutional clients."Traders are not ready to take that off just yet, given the moves and given that fact that everyone is telling us roughly four to six weeks before we have a true idea of the impact of this virus," he said.
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