Bond MOVE index says something big is brewing and it’s usually trouble. The index jumped from 40 points at the end of September to the current 60.
The MOVE index is therefore the equivalent of the VIX bond market. The MOVE index measures the volatility on options traded on US Treasury Bonds, it represents a risk barometer to understand how the sentiment of operators on the US bond market tends to move. The MOVE Index tends to move between 80 and 120, with 80 representing a situation of extreme complacency and 120 representing a sentiment of extreme fear. Since the implied volatility is the cost of insurance, the MOVE measures the willingness of investors to purchase risk insurance. The lower this index, the lower the demand for risk protection.
The MOVE index is therefore the equivalent of the VIX bond market. The MOVE index measures the volatility on options traded on US Treasury Bonds, it represents a risk barometer to understand how the sentiment of operators on the US bond market tends to move. The MOVE Index tends to move between 80 and 120, with 80 representing a situation of extreme complacency and 120 representing a sentiment of extreme fear. Since the implied volatility is the cost of insurance, the MOVE measures the willingness of investors to purchase risk insurance. The lower this index, the lower the demand for risk protection.
