The quietest room is usually the loudest -
š $VIX - the fear index
Last Friday, the VIX fell to 14.36, the lowest level since late December 2025 - while the S&P 500 is near its highs. š
In simple terms - the market is pricing in very little fear. ā³
And that's exactly what makes the picture interesting,
Volatility is low, stocks are near highs, retail investors are returning to the market, options buying is increasing, the 'stocks only go up' narrative is back,
And those who sold in April - are watching the market from the sidelines with FOMO šµ
But here's the important point ā³
Note the attached chart - the chart shows the seasonality of the VIX.
Historically - volatility tends to rise in the coming months, reaching the 22 - 22.5 range towards the end of October.
But there's a catch here,
A large part of this increase stems from 2 particularly extreme years, 2008 and 2020.
If these two years are removed from the calculation, the curve becomes much less dramatic.
That is, seasonality exists, but it is not as strong as the initial chart makes us think.
And yet, these 2 events in those years happened.
And that's exactly the point.
You don't need to build an investment portfolio that assumes October will be 'average'.
You need to build a portfolio that can survive even a non-average year (!)
Because when the VIX is low, it's very easy to increase positions, take on more leverage, sell hedges, and feel that the risk has disappeared.
The risk has not disappeared. ā³
When the market is calm - the important question is not how much money can be made if the calm continues,
but how much the portfolio can absorb if the calm ends.