While I am not new at trading, I have a question for the swarm intelligence of reddit (the word intelligence used very hesitantly here):
The VIX routinely swings between 20 and 30 usd. I am almost inclined to think, that whenever the VIX hits 20 or below, it is an almost assured thing, to say that at some point in the next few months, volatility will pick up again and rise to around 30 (as it has historically).
Looking at the full-length historic chart, it has peaked above 30 at least 40 times since 2004, with the peaks becoming more frequent as time passes.
Looking at the macro-situation, I highly doubt volatility will decline anytime soon, no matter what fed / ECB policies are implemented, or what political factors change.
As such, I see the probability of the VIX swinging in this same range (if not higher) as time goes on as rather high, if not close to 100%.
So the investment idea would be to just buy whenever it drops below 20, and sell whenever it rises above 30.
Am I missing something here? Misinterpreting? Is this just too obvious to work?
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