What is TailDex - A Better Way to Evaluate Black Swan Risk In Stocks & Options

TailDex is an index showing the markets' sentiment about the probability of a steep drop is stock prices in the short term.

In this video, we explain how the TailDex is constructed, and why it is a better representation of the risk of tail events, also called "Black Swan" events, where the stock market sells off by more than 3 standard deviations.

We also explain why TailDex is a better representation of these risks than the VIX index.

00:23 Market sentiment about "Black Swan events" or "Tail Risk"
00:46 TailDex definition
01:34 Using realtime data
03:09 Why VIX doesn't work to identify Tail risks
04:05 Why VolDex isn't as effective at identifying Tail risks
04:40 Ticker symbol TDEX

###
Get our free weekly volatility insights - https://nationsindexes.com/insights/
###
Scott Nations is the President and Chief Investment Officer of Nations Indexes, the world’s leading independent developer of volatility and option cost indexes. Nations Indexes grew out of his previous work leading proprietary equity index option trading firms during 25 years as a floor trader at the Chicago Mercantile Exchange.

During that work his team created the Nations Indexes suite of option volatility and option cost indexes including VolDex® (ticker symbol VOLI) which measures implied volatility on the S&P 500 and TailDex® (ticker symbol TDEX) which quantifies how much investors are willing to pay to protect their portfolios.