Should We Fear Volatility? Episode #447

by | Jul 21, 2023 | Podcasts

So, should we fear volatility with investment accounts and the market?

In episode #447, Tim and Tom discuss the VIX Index, or “fear gauge” and how volatility is usually interpreted as “bad.”
Hey – volatility is nothing more than changes in price – and not necessarily a negative!

There seems to be some common myths about volatility, but volatility may (could) work in your favor! After all, the volatility index (VIX for short) is often referred to as the “fear gauge!”

We will take you on a thrilling ride through the peaks and valleys of the stock market, centering on the often misunderstood VIX index. We’ll show you how it’s not a “fear gauge” but perhaps might instead Volatility of Investmentsbe a weather vane – signaling when the storm might be about to pass.

Switching lanes, we’ll explore the varying return rates of cash, bonds, and stocks, especially when measured AFTER inflation. This is something few in our industry discuss. Which leads into why a long-range perspective is vital when playing the investment game. We’ll spotlight the Fed’s endeavor to whittle inflation down to 2%, and the potential for “what could go wrong.”

More importantly, we’ll emphasize why patience is key in the market, and how it can turn into your greatest asset. Whether you’re an investment veteran or a rookie, this episode promises a wealth of insights to shape your investment strategy. So, strap in, and let’s take this ride together!

 

 

Time Stamps for “Should We Fear Volatility? Episode #447”

00:54 –  Positive and Negative Sides of Volatility
03:15 –  Explaining the VIX Index (“the fear gauge”)
04:15 –  A chart without volatility looks like…
05:50 –  You can only connect the dots looking in reverse
08:40 –  The past ten years – average annual declines, 13%
12:58 –  Returns NET of inflation

You can find all our podcasts on Apple, Spotify and wherever you listen to podcasts, or you can listen to the Mullooly Asset Podcasts right here on our website.

Links for ““Should We Fear Volatility? Episode #447”

https://www.carsongroup.com/insights/blog/now-they-turn-bullish/
https://politicalcalculations.blogspot.com/2006/12/sp-500-at-your-fingertips.html#.Y3eqZ_dOlaQ
https://am.jpmorgan.com/us/en/asset-management/adv/insights/market-insights/guide-to-the-markets/ (slides 15 & 65)

Transcript for ““Should We Fear Volatility? Episode #447”
(transcript coming soon)

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