The VIX Index Timing Model

Volatility represents one of the key elements in the pricing of stock index options. Implied volatility represents the options market's consensus opinion of future annualized change in an underlying vehicle. The VIX index, tracked by the CBOE, measures the implied volatility of a series of "at the money" OEX index options. Typically the VIX will range between 10% and 20%. The higher the VIX index, the more expensive option prices are due to volatility.
In developing your OEX trading strategies, you should take into account the level of implied volatility as measured by the VIX. Ideally, you should be selling options when implied volatility is high and about to fall. By the same token, you should attempt to buy options when implied volatility is low and about to rise.
The VIX model that I am about to share with you is designed to give you a small advantage in figuring out the direction of implied volatility. The model has excelled at catching 2-3 point moves in the VIX on the long and the short side. In fact, the model has had a perfect track record using only very simple rules.
The VIX model that I am about to share with you is designed to give you a small advantage in figuring out the direction of implied volatility. The model has excelled at catching 2-3 point moves in the VIX on the long and the short side. In fact, the model has had a perfect track record using only very simple rules.on the trades. Therefore, rather than trade the VIX, you should incorporate the VIX model into your option strategies as noted.