This article was written exclusively for Investing.com
The last couple of weeks have been very volatile for the stock market, with a sharp drawdown in the S&P 500 followed by an equally sharp rebound. The culprit in all of this volatility has been rising interest rates, which have battered overvalued growth stocks, leading PE ratios to decline.
The push and pull of rising rates have left investors uncertain of what comes next. Some traders are betting that that uncertainty leads to more volatility. As a result, they have been actively betting that the VIX index spikes to much higher levels by buying call options in the volatility index.
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