Book 162

Risk On, Risk Off

by Michael McCarty

Published 21 August 2012
A noted expert explains how to trade and hedge volatility in the fast-growing financial marketsTrading and hedging volatility is an increasingly important topic in the wake of the recent financial crisis. Trading Volatility in Risky Markets examines how active traders can profit from the profusion of new volatility-based products and how money managers can smooth their returns by hedging volatility risk. Author Michael McCarty explains traditional and new measures of volatility; the structure and mechanics of new volatility tools; and how these tools can be used by different levels of market participants to invest, trade, and hedge more effectively.While the history of trading volatility-based instruments is brief, McCarty combines the historic data with analysis to provide a taxonomy of how volatility measures reflect market sentiment and directional bias. He also includes an in-depth explanation of VIX options, futures, and exchange-traded notes so that participants will be better prepared to use these tools confidently and avoid unexpected outcomes.
* Offers an important resource for traders and money managers who are tapping into new volatility-based products to speculate, hedge, and gauge market sentiment * Includes guidance for trading the VIX Index Futures and VIX Index options * Author Michael McCarty is noted for his research on volatility and detecting unusual option activity in stocks about to crashTrading Volatility in Risky Markets provides an in-depth explanation of some of the most misunderstood aspects of volatility-based instruments and shows how these instruments can be used to forecast markets, trade, and hedge.