Series 7 - General Securities Representative Exam
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The VIX index measures the implied volatility of SPX index options. When the VIX is high, which of the following is TRUE?
It indicates fear in the marketplace
A
It indicates greed in the marketplace
B
It indicates that SPX options have low premiums
C
It indicates that CPI is low
D
Explanations
When the VIX is up and trading at high levels, it indicates fear in the marketplace. It has a mostly inverse correlation to the S&P 500 index