Asia volatility indexes mirror pre-crisis market conditions

A lack of leverage in the system means the market correction should be less severe than during the financial crisis with central bank intervention the key factor

With US and Asian volatility indexes at near record lows and equity indexes close to record highs, markets are exhibiting similar characteristics to pre-financial crisis levels, however interest from Asian investors to hedge tail risk remains low, say market participants.

CBOE Vix stood at 11.36 at the close of May 23, its lowest level since March 2013 – and close to its 2007 low of 9.89, which it hit in January of that year. Similarly in Asia, Asian volatility indexes are also at near record