New Year’s U.S. Stocks Slump Seen Overdone in VIX Futures
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U.S. equities started the year with the worst losses since 2008. Trading in a corner of the market where speculators bet on future volatility suggests the pain will prove temporary.
The Standard & Poor’s 500 Index plunged 4.2 percent in five days through yesterday and was down 2.7 percent since the end of 2014, the biggest retreat since it fell 3.9 percent in the financial crisis. Prices for contracts tied to levels of expected stock turbulence in months through September show traders expect this month’s swings to calm down as the year progresses.