Question: How do you exploit an expected spike in volatility when you feel it will be only temporary?

摘要

The books on 2011 are closed and as a new year begins, traders ask the ubiquitous question: "What do you think the coming year will bring?" A compelling argument could be made that volatility is the only given, particularly cosidering recent years. The broad market, as viewed by the S&P 500, rang in 2011 right around 1257 and will begin 2012 about the same. Not very volatile, but that understates 201 l's inherent instability. Keep in mind that at one point in March 2011 the S&P was up nearly 7% (at 1360), and as the fourth quarter began the S&P was right at 1100, down almost 14% on the year and right at the 20% "bear market" decline from highs.