Again, the S&P 500 continues to trek higher closing at an all-time high of 1666.12 on Friday. VIX action was pretty tame this past week sticking in a very narrow range of 12.26 to 13.46. Much ado was made about VIX trading higher in sync with the S&P 500 a couple of days this week. However, it is tough to get excited about this occurrence when VIX is already at such a historically low level. Repeating a statement / question I heard a couple of times this week, “How much lower can VIX go?” If 2007 is a good guide then the single digits is actually possible.
VVIX continues to muddle along at a low level as well staying in the low 80’s for the week. There has not been too much call buying to take advantage of the already low absolute level of VIX. This past week we were sort of in limbo as May expiration is next week. Look for some rolling transactions early in the week as the focus moves to June expiration. A little of that showed up this past week as there was a buyer of the VIX Jun 21 Calls paying around 0.40.