@deltatrendtrading: Replying to @ollum What is the $SKEW Index actually telling us? The $SKEW Index reflects the market's pricing of tail risk — the probability of extreme downside moves in the S&P 500. When it spikes, it means out-of-the-money puts are becoming significantly more expensive than out-of-the-money calls. In other words, the market is willing to pay up for crash protection. After C****, $SKEW became way more volatile — but why? It might be partially due to increased retail options trading, but I think it runs deeper. Just like the 1987 crash changed how traders valued downside protection forever, C**** reminded the market that massive drawdowns do happen. Even while stocks rallied and VIX dropped, $SKEW stayed elevated — because institutional memory of tail risk stayed intact. Sometimes the market starts pricing in a crash… then a small selloff happens… and $SKEW drops — as if traders are asking, “Wait, was that the crash?” I think that could be the back-and-forth we’ve seen ever since. #opt#optionsa#quantfinancer#marketcrashe#skewindexi#tailriskx#vixx#spxt#optionpricingl#volatilityn#financialmarketsd#hedgefundsa#tradingstrategyn#financetokc#macrotradinga#blackscholess#riskmanagemento#stockmarketktokfinance

Thomas

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Tuesday 15 April 2025 19:51:37 GMT