Why The Crash-Down Rebound Won’t Morph Into A New Crash-Up

If you're wondering what typically happens to equities and the VIX following two-session spasms akin to the melodramatic August 2-August 5 vol shock, the answer is that stocks are typically higher and vol lower. That's not surprising. Particularly the "0%" hit rate for a higher VIX on the heels of episodes when the "fear gauge" outperforms on a beta-to-SPX basis. After all, vol's mean reverting in the absence of rolling shocks to prop it up. That tendency doesn't everywhere and always preclude