Volatility and VIX#

Volatility measures the magnitude of price changes in an asset. High volatility means large and rapid price movements — both up and down.

The VIX (Volatility Index) is nicknamed the "fear index". It measures the implied volatility of the S&P 500 over the next 30 days. A VIX below 20 indicates a calm market. Above 30, it's panic.

Experienced traders use volatility as a tool: they buy when fear is at its peak (high VIX) and stay cautious when everything seems too calm.