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Opinion

Two threats to shares

Two threats to shares
August 21, 2012
Two threats to shares

One is that the VIX index - a measure of implied volatility on S&P 500 options - is low. At 13.4 percentage points, it is close to its lowest level since June 2007, which is a sign that investors are less fearful than they have been at any time in the last five years.

This might mean they are too complacent. In the past, a low VIX has led to falling share prices. In July 2011 and April this year the VIX dropped - and stock markets fell sharply in the following month.

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