Latest / The Bear Market Podcast with Fexingo: Surviving Downturns, Buying the Dip, and Long-Term Resilience
The Hidden Fallacy in Volatility Targeting Strategies
Lucas and Luna unpack the limits of volatility targeting—why funds that cut risk when the VIX spikes can lock in losses and miss rebounds. With the VIX at 14.43 and the VVIX at 86.63, they explore how volatility of volatility creates whiplash for systematic strategies. Using a concrete example from August 2024, they explain why human judgment still matters in tail-risk management. A sharp look at a popular but flawed approach.
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The skinny
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