The above chart is for an index called CBOE Volatility Index. It's an index calculated by the Chicago Board of Optiosn Exhcange. The index estimates the expected volatility of the stock market based on the S&P 500 index option prices using a simple but rather genius mathematics. Although you hear about the Dow and Nasdaq in the news more, S&P 500 Index is a better gauge of the overall stock market. Thus what better index to use for estimating volatility. To put it simply, people call it the "fear index". The higher the index, the more "fear" is in the market.
Usually, the index hovers between 10 and 30. The stock market is considered to be in a panic mode when the index gets above 30. Right now, we are at 40, we had a high of 48 on Monday.
Below is a list of top 10 highs since 1990. I don't quite remember what happened in 2002, everyone knows about 2001. And 1998 was the Russian debt crisis and LTCM going under.
| Date | High |
| 9/30/2008 | 43.8 |
| 9/29/2008 | 48.4 |
| 8/5/2002 | 45.08 |
| 7/23/2002 | 44.92 |
| 9/20/2001 | 43.74 |
| 10/8/1998 | 45.74 |
| 10/7/1998 | 43.51 |
| 9/11/1998 | 43.74 |
| 9/10/1998 | 45.29 |
| 8/31/1998 | 44.28 |
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