What is the VIX?
The VIX is a market-implied volatility index often used as a gauge of expected stock-market turbulence.
The short version
The VIX estimates expected volatility for the S&P 500 using options prices. People often call it a fear gauge because it tends to rise when investors pay more for downside protection.
What it measures
The VIX is not a survey and not a direct prediction of direction. It reflects the market price of expected volatility over a near-term window, based on options demand and supply.
How to read it
Rising VIX usually means investors expect bigger swings or are buying protection. Falling VIX usually means volatility expectations are easing. Extremely low or high readings can both be important, depending on context.
Common mistake
A high VIX does not guarantee stocks will keep falling, and a low VIX does not guarantee calm forever. Volatility can spike after the market has already dropped or stay low during steady uptrends.
What to compare
Watch the VIX beside credit spreads, Treasury yields, index breadth, options positioning, and market liquidity. The signal is stronger when several risk gauges agree.