Welcome to this week’s episode of Vol Street Journal™!
Since the close on December 31, 2025, the S&P 500 is up 1.3%. But as is always the case when looking at the world through the lens of volatility, it’s not where we go that matters, but how we get there.
During that same window, S&P 500 (annualized) 30-day realized volatility has risen from below 9% to above 13%. Implied volatility, as measured by the VIX, has increased modestly by roughly 3 vol points from the 12/31/25 close to the 2/6/26 close, but rose by more than 8 vol points from the end of 2025 to its 2026 peak.
And maybe the most compelling statistic of them all is that the (annualized) 30-day realized volatility of the VIX itself has risen from around 82% on 12/31/25 to over 154% on 2/6/26. These first 5+ weeks of the year have not been boring.
That brings us to this week’s episode, where I start by taking a look at some relative moves and explain how using relative moves can be very informative when trying to assess a market in the midst of a selloff. From there, I run through some noteworthy statistics that suggested Thursday’s selloff was getting over its skis.
After that, I revisit a few favorites of mine that have provided powerful clues as to what’s happening below the surface: volatility composition and the relationship between credit spreads and the VIX.
Last but not least, I give credit where credit is due: equities have been really darn resilient despite plenty of turbulence. The Russell has done a lot of heavy lifting, and even though volatility markets aren’t completely comfortable with the Nasdaq lagging so significantly, shorting this market continues to be a losing trade.
Here we go!
