Russell 2000 (RVX) Volatility on the Rise

After posting new highs last week (1296.00 on 6/23), the Russell 2000 has slipped in four consecutive days closing Friday at 1279.79 (-1.25%).  With this morning’s markets reacting sharply lower on the news of Greece closing its banks temporarily, a closer look at the CBOE Russell 2000 Volatility Index is warranted.  Traded on the CBOE, the CBOE Russell 2000 Volatility Index options can offer an effective hedge.  As highlighted in the chart below, the CBOE Russell 2000 Volatility climbed 1.58 or (+9.76%) in the last 4 trading days providing a hedge to the recent decline in the Russell 2000 Index.

111 rvx