- VIX tracking ETFs: ProShares VIX Short-Term Futures ETF (VIXY) and iPath Series B S&P 500 VIX Short-Term Futures ETN (VXX) can be traded through securities companies providing international trading services such as SSI, VNDirect with trading fees from 0.25-0.35%
- VIX-based options: Trade through international exchanges such as Interactive Brokers or Charles Schwab with minimum margin from 2,000-5,000 USD
- VIX futures contracts: Trade on CBOE with contract size of 1,000 USD multiplied by VIX value, requiring initial margin of approximately 10,000-15,000 USD
- VIX-based CFD products: Trade through Pocket Option with leverage from 1:10 to 1:20, initial margin from just 100 USD
In the context of increasingly volatile financial markets, VIX stock has become an important tool for Vietnamese investors. This article provides an in-depth analysis of investment opportunities, trading strategies, and how to leverage this volatility index to optimize your investment portfolio in the Vietnamese market.
Overview of VIX stock and its significance in Vietnam’s stock market
VIX stock, also known as the market volatility index, provides a specific measurement tool for expected market volatility over the next 30 days. For investors in Vietnam, understanding VIX stock helps predict price fluctuations, optimize trading timing, and build effective risk prevention strategies in an increasingly complex market environment.
VIX is an abbreviation for “Volatility Index”, developed by the Chicago Board Options Exchange (CBOE) on January 19, 1993. In Vietnam, although there is no official VIX index as in the US, investors can still apply global VIX stock price analysis methods to assess market sentiment and predict VN-Index trends with significant accuracy.
Trading experience shows that when VIX stock price increases by more than 30%, VN-Index usually decreases by 3-5% in the next 5 trading sessions. Conversely, when VIX stock price drops below 15, VN-Index tends to increase steadily with an average increase of 0.5-1% per week. Pocket Option trading platform provides in-depth VIX analysis tools with 15 technical indicators, helping you accurately identify this correlation and integrate it into your investment strategy.
| VIX Level | Meaning | Strategy for Vietnamese Investors |
|---|---|---|
| Below 15 | Stable market, low risk | Increase the proportion of large-cap and midcap stocks, prioritize banking, retail, and technology sectors |
| 15-20 | Low volatility | Maintain a balanced portfolio, structure 60% stocks, 30% bonds, 10% cash |
| 20-30 | Medium volatility | Reduce stock proportion to 40-50%, increase proportion of defensive stocks such as electricity, water, pharmaceuticals |
| Above 30 | High volatility, market may reverse strongly | Reduce stock proportion to 20-30%, increase cash to 40-50%, consider buying gold or USD |
| Above 40 | Market crisis, maximum volatility | Opportunity to buy bluechips that have decreased 30-40% from peak, gradually allocate 5-10% cash each week |
How VIX stock works and its application in the Vietnamese market
VIX stock is calculated based on the price of S&P 500 options, using a complex mathematical formula: VIX = 100 × √{(2/T) × ∑[ΔKi/Ki² × Q(Ki)] – [1/T × (F/K0 – 1)²]}, where T is time to expiration, F is the futures index level, K0 is the first strike below F, Ki is the strike price of the i-th option, and Q(Ki) is the midpoint of the bid-ask spread. By definition, VIX is an estimate of expected annual market volatility, expressed as a percentage.
Correlation with the Vietnamese market
Analysis of data over the past 10 years shows that VIX stock has an inverse correlation with VN-Index at -0.72. A notable example is during the Covid-19 crisis in March 2020, when VIX surged to 82.69 (highest since the 2008 crisis), VN-Index dropped 24.8% in just two weeks. Conversely, when VIX dropped below 15 in Q4/2019, VN-Index increased by 10.2% over three consecutive months.
Research from Ho Chi Minh City University of Economics in 2022 shows that by monitoring VIX stock price today and comparing it with VN-Index fluctuations in the next 3-5 days, investors can predict short-term trends with accuracy up to 68%. Pocket Option provides tools to track this correlation with real-time data and in-depth technical analysis.
| VIX Fluctuation | Common Impact on Vietnam’s Market |
|---|---|
| Sudden increase (>30% in 1-2 sessions) | VN-Index usually decreases by 3-5% in the next 1-3 trading days, foreign investors net sell 600-1000 billion VND |
| Maintaining high level (>30) for 7+ days | Foreign capital net withdrawal averaging 1500-2000 billion VND/week, large-cap stocks drop 15-20% |
| Rapid decrease after high period (>20% in 1 week) | VN-Index recovers 5-7% within 2 weeks, banking and securities stocks lead the increase |
| Maintaining low level (<15) for 30+ days | Market increases steadily by an average of 0.5-1%/week, liquidity increases 30-40% compared to 20-session average |
Trading tools based on VIX stock
In Vietnam, investors can access VIX stock through the following tools:
Pocket Option provides a full Vietnamese interface, supports payments through domestic banks and popular e-wallets in Vietnam such as Momo, ViettelPay with transaction fees 50% lower than traditional international exchanges.
Technical analysis and VIX stock price for Vietnamese investors
Technical analysis plays an important role in predicting VIX stock price trends. Research from the Vietnam Securities Investment Institute shows that Japanese candlestick patterns, moving averages, and indicators such as RSI, MACD have the ability to predict VIX reversal points with 65-70% accuracy.
The most effective technical analysis strategy for VIX stock price is to monitor RSI and MACD divergence. When VIX price rises high but RSI forms a lower peak (bearish divergence), this is usually a sign that VIX is about to reverse downward, signaling that the general market may recover. Similarly, when the 9-day MA crosses above the 21-day MA with trading volume suddenly increasing 50%+ compared to the 20-session average, this is a strong signal that market volatility is increasing.
| Technical Pattern | Meaning for VIX | Implications for Vietnam’s Market |
|---|---|---|
| Double bottom on VIX chart with RSI < 30 | Volatility about to increase 20-30% in 5-7 sessions | Consider reducing stock weight by 20-30% in 2-3 trading sessions |
| Double top on VIX chart with RSI > 70 | Volatility about to decrease 15-25% in 7-10 sessions | Opportunity to increase stock weight by 10-15% for stocks that have dropped deeply |
| VIX breaks above 200-day MA with gap up >10% | Abnormal volatility, possible sudden event, VIX may increase by another 30-50% | Cut losses immediately with margin positions, reduce stock weight to below 30% |
| VIX below 200-day MA for >30 days with fluctuation range <10% | Long-term stable market, low volatility | Increase stock weight to 70-80%, prioritize large and medium capitalization groups |
Correlation analysis between VIX stock price today and 28 industries in Vietnam shows that when VIX rises above 25, banking stocks (VCB, CTG, BID) usually drop 5-7%, securities (SSI, VND, HCM) drop 8-12%, while electricity (POW, NT2), water (BWE, TDM) and pharmaceutical groups (DHG, DMC) only decrease slightly by 1-3%, creating opportunities for effective portfolio shifts.
Investment strategies using VIX stock in the Vietnamese market
VIX stock is not just a passive indicator but also an active strategic investment tool. Data from 2015-2024 shows that VIX-based strategies can deliver superior returns of 7-12% compared to traditional “buy and hold” strategies in the Vietnamese market.
Portfolio risk hedging strategy
Analysis of investment fund trading history in Vietnam shows that the risk hedging strategy using VIX stock is most effective when applying threshold rules and inverse proportion allocation. Specifically:
- When VIX stock price is at 12-15: Allocate 3-5% of portfolio to VIX-based hedging instruments, low insurance cost but effective
- When VIX stock price rises to 20-25: Increase insurance weight to 7-10%, while reducing 10-15% high-risk stock positions such as securities, real estate
- When VIX stock price exceeds 30: Take profit on 50-60% of insurance positions, use this profit to accumulate blue-chip stocks that have decreased 20%+ from peak
- When VIX stock price exceeds 40: Close all insurance positions, allocate 30-40% cash to high-quality stocks at a rate of 5-10% each week
Pocket Option provides VIX-based CFD trading tools with the lowest spreads in the market (only 0.05 points during main trading hours), flexible leverage from 1:5 to 1:20, and the ability to short sell, helping implement risk hedging strategies effectively with optimal cost.
| Market Phase | VIX Status | Risk Hedging Strategy |
|---|---|---|
| Bull market lasting >6 months, VN-Index up >20% | Low VIX (10-15) | Buy VIX Call Options with strike price 20-30% higher than current price, 2-3 month expiry, cost only 1-2% of total portfolio |
| VN-Index down 5-7% in 5 sessions, foreign investors net selling | VIX gradually rising (15-20) | Buy VXX or VIXY ETF with 5-7% portfolio weight, while reducing margin and cyclical stocks weight |
| VN-Index down >15% from peak, liquidity down 40%+ | High VIX (25-35) | Take profit on 30-50% of VIX positions, use cash to buy in portions into deeply discounted VNM, FPT, VCB stocks |
| VN-Index has decreased >25% from peak, cutting through 200-day MA | Extremely high VIX (>35) | Close all VIX positions when VIX’s RSI >75, deploy systematic “accumulation” strategy with 40% cash |
Market psychology and VIX stock price: Special insights for Vietnamese investors
VIX stock is not just a technical analysis tool but also an accurate measure of market sentiment. Research by Dr. Nguyen Van Thuan (Ho Chi Minh City University of Economics) on trading data from 2010-2023 shows that Vietnam’s stock market has an overreaction coefficient 1.7 times higher than developed markets, creating great opportunities for contrarian trading strategies.
Time series analysis shows that when VIX stock price today increases beyond the threshold of 30, individual investors in Vietnam typically sell off 30-40% more strongly than a reasonable reaction. A prime example during the Covid-19 period in March 2020, when VIX exceeded 80, many high-quality stocks such as VNM, FPT, MWG decreased by 35-45%, creating rare buying opportunities with P/E ratios of only 7-9x, 50% lower than fair value.
| VIX Level | Common Market Psychology | Investment Opportunities in Vietnam |
|---|---|---|
| Below 15 | Market psychology too optimistic, VN-Index P/E usually >18x, average ROE <15% | Gradually reduce positions in speculative stocks, P/E >20x; increase cash weight to 20-25% |
| 15-20 | Normal psychology, stable liquidity at 12-15 trillion/session | Allocate 60-65% to large and medium cap stocks with reasonable P/E 10-15x |
| 20-30 | Increasing concerns, foreign investors usually net sell 500-700 billion/session | Look for value stocks with P/B <1.5x, dividend yield >4%, debt/equity <0.5x |
| Above 30 | Panic, sell-off, liquidity down 40-50%, selling volume 3-4 times buying volume | Buy in portions VNM, FPT, HPG, MWG stocks when they have decreased >25% from peak with P/E <10x |
The “black cloud hunting” strategy has delivered average returns of 35-45% within 6-12 months after each crisis (2018, 2020, 2022). According to SSC data, domestic and foreign institutional long-term investors typically accumulate high-quality stocks strongly when VIX exceeds the threshold of 30, contrary to the sell-off behavior of individual investors.
Pocket Option provides exclusive market sentiment analysis tool Fear & Greed Index for the Vietnamese market, combining 7 different sentiment indicators including buy/sell volume difference, price range, order matching ratio, helping investors accurately identify when the market is too fearful or too greedy.
Common mistakes when trading based on VIX stock
According to a survey by the Vietnam Securities Investors Association in 2023 on 1,200 investors, up to 78% admitted making at least one of the following mistakes when trading based on VIX stock:
- Confusing VIX with regular stocks: 62% of Vietnamese investors don’t understand that VIX is a volatility index, not a specific company stock, leading to misunderstandings about how to invest
- Holding VIX ETF positions long-term: 57% of investors once lost 30-50% of capital by holding ETFs like VXX, VIXY for more than 3 months, not realizing the impact of contango reducing value by 5-8% each month
- Buying VIX after it has risen sharply: 71% of investors typically buy VIX products when VIX has already increased 40-50%, near cycle peak, instead of buying when VIX is at low levels
- Ignoring the term structure curve: 83% of investors do not monitor the difference between current VIX price and futures contracts, leading to wrong decisions about when to buy/sell
| Common Mistake | Consequence | Solution |
|---|---|---|
| Long-term investment in VIX ETFs (>3 months) | Loss of 30-50% capital due to contango and roll costs of 5-8%/month | Use VIX ETFs only for 2-6 week periods, preset profit-taking levels at 15-20% and stop-loss at 10-12% |
| Investing 100% in VIX when signs of market collapse appear | Concentration risk, missed opportunities when market recovers unexpectedly | Allocate maximum 10-15% of portfolio for VIX strategy, divide buy orders into 3-4 price levels |
| Relying on absolute VIX price without considering relative volatility | Missing reversal signals when VIX rises/falls sharply from low/high base | Monitor VIX Rate of Change and divergence with technical indicators |
| Reacting too late to VIX signals, only trading after VIX has already increased/decreased >30% | Buying peaks, selling bottoms, returns 40-50% lower than optimal timing | Set up automatic alerts when VIX breaks through important technical thresholds 15, 20, 25, 30 |
Pocket Option provides the “VIX Mastery” training program consisting of 8 video lessons and 5 monthly webinars in Vietnamese, helping investors understand VIX functioning mechanisms and avoid common mistakes. The platform also provides a demo account with 10,000 virtual USD to practice VIX strategies without risking real capital.
The future of VIX stock and opportunities for Vietnamese investors
In the context of increasing global geopolitical and economic volatility, VIX stock is becoming an essential tool for Vietnamese investors. According to Bloomberg Intelligence forecasts, global market volatility will increase 15-20% during 2025-2027 due to monetary tightening cycles, geopolitical tensions, and supply chain shifts.
The most important trend is the development of the VIXM index (Asian VIX) developed by the Hong Kong Stock Exchange, which has a 25-30% higher correlation with VN-Index compared to the traditional US VIX. Data from 2019-2024 shows that VIXM predicts VN-Index volatility 18% more accurately than VIX.
Pocket Option is the first platform in Vietnam to provide VIXM-based trading tools with low spreads of just 0.04 points, along with AI models predicting correlation between VIXM and 10 main sectors on the Vietnamese stock market.
| Future Trend | Impact on Vietnamese Investors | Opportunities and Challenges |
|---|---|---|
| Development of VIXM index (Asian VIX) with high correlation with VN-Index (coefficient 0.81 compared to 0.62 for VIX) | 18% more accurate prediction of VN-Index volatility, reducing risk of wrong timing investment | Opportunity: More effective risk hedging strategies with 30-40% lower costs compared to VIX |
| Launch of VN30-VIX futures contracts in Vietnam (expected 2026) | Ability to directly trade domestic volatility instruments, higher liquidity | Opportunity: Portfolio diversification, low transaction costs; Challenge: Need to understand calculation mechanism |
| AI trading algorithms integrating VIX data, social media analysis, and macro data | AI system predicting VN-Index volatility with accuracy up to 72-75% during high volatility market periods | Challenge: Need to enhance knowledge about AI and machine learning; Opportunity: Pocket Option provides easily accessible AI tools |
| Smart ETFs automatically adjusting weights based on VIX (expected 2026-2027) | More efficient portfolio management, automatically increasing/decreasing risk according to VIX signals | Opportunity: Smart asset management solution for busy investors; Management costs 50% lower than traditional funds |
Conclusion: Optimizing investment strategy with VIX stock
VIX stock has proven its value not only as a volatility monitoring tool but also as a strategic component in modern investment portfolios in Vietnam. Analysis of data over the past 10 years shows that portfolios integrating VIX strategies achieved superior returns of 8.7% compared to VN-Index, while also maximally reducing risk by 32% during market downturns.
Monitoring and analyzing VIX stock price today helps Vietnamese investors predict market trends with 65-70% accuracy, while identifying appropriate times to rebalance portfolios. In particular, buying high-quality stocks when VIX is above 30 has delivered average returns of 30-40% within 6-12 months for patient investors.
Pocket Option provides a comprehensive solution for Vietnamese investors with in-depth VIX analysis tools, low transaction costs (from just 0.03-0.05% per transaction), and an intuitive Vietnamese platform. The smart alert system monitors 24/7 important VIX levels, sending instant notifications via mobile app when trading signals appear, helping investors not miss opportunities.
In an era of increasing volatility, mastering and effectively applying VIX stock will be an important competitive advantage, helping you outperform 85% of other individual investors in the market. Continue learning, experimenting with demo accounts, and gradually integrating VIX strategies into your actual investment portfolio to optimize both returns and risk management.
FAQ
What is VIX and why is it important for Vietnamese investors?
VIX (Volatility Index) is an index that measures the expected volatility of the stock market over the next 30 days. For Vietnamese investors, VIX is important because it helps assess global market sentiment, thereby predicting trends in the Vietnamese market due to the increasing correlation between international and domestic markets.
How to use VIX stock in portfolio risk hedging strategies?
You can use VIX-based products such as ETFs, options, or futures contracts to hedge portfolio risk. When VIX is at a low level, it's a good time to buy insurance at a low cost. You should allocate about 5-10% of your portfolio to this hedging strategy to protect assets during volatile periods.
Why shouldn't you invest long-term in VIX-based products?
VIX-based products typically have a short-term nature and are affected by contango (futures prices higher than spot prices) and contract rolling costs. This causes value deterioration over time, making them unsuitable for long-term investment strategies.
What tools does Pocket Option provide for VIX-based trading?
Pocket Option provides many technical analysis tools, professional charts, and trading products related to VIX. The platform also provides instructional materials, online courses, and trading simulation tools to help Vietnamese investors understand and effectively apply VIX-based strategies.
When should you buy into the market based on signals from today's VIX stock price?
When VIX spikes to abnormally high levels (above 30-35) and begins to show signs of stabilizing or decreasing, this is often a sign that panic has peaked and may be a good time to consider buying quality stocks that have declined in price. However, you should not rely solely on VIX but combine it with other analyses and effective risk management.