JPMorgan prediction- Volatility of shares is going to increase in the year 2024
New Delhi: Volatility of stocks is going to increase in the year 2024. This estimate comes from JPMorgan Chase & Co. The strategist has expressed. He says the Cboe Volatility Index (VIX), a key measure of stock market concern, will rise in 2024. How much Cboe will rise depends on the strength of the economy. According to a Bloomberg report, JPMorgan Chase & Co. US equity derivatives strategists say the Cboe Volatility Index will rise more in 2024 than in 2023. How much the increase will be will depend on the timing and severity of the potential recession.
It was also said that the new year may see wide fluctuations, which may curb short-term volatility selling. VIX is an important gauge of market volatility. The VIX fell below 12.5, its lowest level since January 2020. The reason for this was that the rise in American stocks continued for more than six weeks. This reflects the expectation of central bank policy easing in 2024.
Average VIX reading this year 17
The average VIX over the last 5 years has been around 21. Strategists say the average VIX reading in 2024 will be different from this year’s average reading of 17. At the same time, if there is a mild recession in the second half of 2024, then the average reading may go to a lower level. According to the strategist, these scenarios assume that geopolitical risks may both wane and increase from time to time but that those risks are not realized. If a major event occurs, such as a war in the Middle East turning into a broader regional conflict, a conflict between superpowers, etc., then in such a situation, very high levels of VIX can be seen. Also, read this.