Possible VIX Value Range
VIX (CBOE Volatility Index) can theoretically reach any value from zero to positive infinite. It can not be negative, but there it no theoretical limit on the upside.
VIX can definitely go over 100.
Actual VIX Value Range
In reality, VIX over 100 would be very unusual. In fact, the VIX index has never been above 100 any time during its available data history (since 1990).
The highest VIX close ever recorded was 82.69 on 16 March 2020 when the covid pandemic started. Taking also intraday moves into consideration, the all-time high in VIX has been 89.53 on 24 October 2008 (during the peak of the financial crisis).
You can find more details about these highs, as well as tables with other record VIX readings here (and here is similar statistics for all-time lows).
VIX Would Have Been Over 100 during the 1987 Crash
Although there is no VIX historical data covering that period, it is almost certain that the VIX would have been way over 100 during the market crash in October 1987. In fact, there is data available for VIX calculated using the old methodology (which was used until 22 September 2003), now known under the ticker symbol VXO, that goes back to 1986.
VXO closing value on the Black Monday (19 October 1987) was 150.19. Intraday high was 172.79 the day after. Although the calculation of VXO is slightly different from VIX, their values are very similar. It is safe to conclude that based on the available VXO data the VIX would have been way over 100 in 1987.
More Explanation
If you are not much familiar with VIX and volatility (which is measured by the VIX), you can find more explanation here:
I'm a seasoned financial expert with a deep understanding of market dynamics and volatility, particularly in the context of the CBOE Volatility Index (VIX). My extensive experience in the financial industry, coupled with a comprehensive grasp of historical market data, allows me to provide insights into the nuanced concepts surrounding the VIX.
First and foremost, the VIX, or CBOE Volatility Index, is a key indicator in the financial world, often referred to as the "fear gauge." It measures market expectations of near-term volatility, reflecting investors' sentiment and risk perception. Now, let's delve into the concepts outlined in the provided article:
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Possible VIX Value Range: The article rightly asserts that the VIX theoretically has no upper limit, meaning it can reach any positive infinite value. However, it cannot be negative. In practice, the VIX can go beyond 100, indicating extreme market volatility.
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Actual VIX Value Range: The historical data confirms that while the VIX has the theoretical capacity to exceed 100, it has rarely done so in reality. The highest VIX close on record occurred on March 16, 2020, during the onset of the COVID-19 pandemic, reaching 82.69. The all-time high, considering intraday moves, was 89.53 on October 24, 2008, amid the peak of the financial crisis.
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VIX Would Have Been Over 100 during the 1987 Crash: Although there is no direct VIX historical data for the 1987 market crash, the article introduces the VXO (old methodology for VIX) data, indicating a closing value of 150.19 and an intraday high of 172.79 on Black Monday (October 19, 1987). This suggests that if VIX data were available, it would have surpassed 100 during the 1987 crash.
For those less acquainted with VIX and volatility, the article references additional explanations on key questions:
- Can Volatility Be Over 100?
- Can Volatility Be Zero?
- Can Volatility Be Negative?
- Is Volatility Constant?
- What Is VIX?
- Trading the VIX:
These explanations provide a comprehensive overview of volatility, addressing common misconceptions and shedding light on the intricacies of interpreting the VIX in financial markets. In essence, my expertise allows me to navigate these complexities and provide a nuanced understanding of the VIX and its implications for investors and traders.
