The CBOE Volatility Index (VIX) measures market expectations for S&P 500 volatility over the next 30 days. Reported as an annualized percentage, a VIX of 16 suggests a ±16% expected move over a year. Low VIX levels signal investor confidence, while higher readings indicate uncertainty or fear. Traders use the VIX to hedge portfolios or speculate on volatility cycles. Long-term investors are better off focusing on company fundamentals and long-term returns rather than short-term market swings.

Read more at Barchart: Interpreting the VIX and Practical Uses