Volatility in all asset classes finally spiked higher for the first time in 2013. Commodities had been jittery for weeks now, and I kept commenting in this space that I was surprised at how low commodity vol continued to be priced. Well, in retrospect, I should have bought some. Implied vol in gold and copper are now well above their 52 week average. But more surprisingly, volatility in equities has quickly moved higher, now around its 52 week moving average for the first time this year.
Here is this week’s Vol Around the World snapshot, courtesy of Bloomberg:
Equity volatility has moved higher, and currency volatility is inching higher. However, the past 52 weeks have actually been a period of low volatility, so moving up to the 52 week average is not a sign of high volatility on an absolute basis. Just more volatile than the very quiet past year.
As I’ve mentioned several times this week, I think that quiet period is behind us for the next few months at least. Buckle up.