NEIL: ALREADY COME IN THE DOW
RIGHT NOW DOWN 170 POINTS.
A LOT OF THIS ON THE
BACK-AND-FORTH OF WHAT'S GOING
ON OUT OF CANADA RIGHT NOW.
HEARING THAT CANADA IS JUST
NOTIFYING THE CANADIAN CITIZEN
HAS BEEN DETAINED IN CHINA.
YOU MIGHT REMEMBER CANADA HOW
THE REST OF THE CSO OF HUAWEI ON
ALLEGATIONS SHE WAS GATHERING
INTELLIGENCE AND SPYING ON
PEOPLE AND OF COURSE THEY WANTED
TO HAVE HER ARRESTED.
THEY DID AND THEN THERE WAS A
HEARING TODAY FOR THE CHINESE
ARE RESPONDING BY ARRESTING A
CANADIAN CITIZEN TO CHINESE HAVE
ALSO TAKEN AND TALK TO
AMBASSADORS FROM CANADA AND
CHINA AND OUR ABBASID OR TO
CHINA.
THIS APPEARS TO BE ESCALATING
THE ONLY THING I CAN SAY THAT
WOULD SUDDENLY ADD TO VOLATILITY
HERE.
ONE WAY OR THE OTHER WORKS TO MY
NEXT GUEST ADVANTAGE BECAUSE IN
THE WORLD IS VOLATILE AND YOU
WANT TO PROTECT YOURSELF FROM
IT, AND THE CHAIRMAN AND CEO OF
THE ACOSTA INSTITUTION.
I WAS JUST SAYING, MOST PEOPLE
ARE FAMILIAR WITH THE FEAR
INDEX, VOLATILITY INDEX AND
THAT'S BEEN ALL OVER THE MAP.
THAT SORT OF SPEAKS TO IS GOING
ON IN THE WORLD.
>> IT DOES INDEED.
THE CHANGE IN THE LEVEL OF
VOLATILITY AND LOOKING AT
VOLATILITY OVER TIME IS VERY
TELLING AND REALLY SHOULD INFORM
YOUR VIEWERS ON THE MARKET'S
PERCEPTION OVERTIME.
VERY IMPORTANT POINT.
NEIL: WHEN YOU HAVE A LOT OF
DEVELOPMENTS TODAY.
THE GOOGLE CEO LEAVING CAPITOL
HILL TODAY.
PEOPLE PROTECT THEMSELVES FROM
WILD SWINGS.
IN YOUR EXCHANGE ADDRESSES
THOSE.
IS IT MORE FANATIC ON A DAY LIKE
THIS?
>> I DON'T THINK A DAY LIKE THIS
HAS BEEN MORE TICKLED HER --
TYPICAL SINCE SEPTEMBER THAN
NORMAL.
IF WE LOOK AT THE YEAR AGO, WITH
A COUPLE SPIKES DURING THE
MARKET REALLY LED BY UNKNOWNS IN
THE MARKETPLACE.
WE HAVE THINGS FOR AN EXTENDED
PERIOD OF TIME BUT THERE IS
CHINA TALKS AMID THE EBB AND
FLOW OF THE PROGRESS THEY ARE.
WHETHER IT IS BREXIT ON FAUX,
OFF THOUGH, THE LIKELIHOOD OF
PASSING SOMETHING THAT'S
REASONABLE.
WHAT IT IS IS STILL UNCERTAIN.
IT IS MORE UNCERTAIN THAN IT HAS
BEEN.
THERE'S AN AVERAGE AVERAGE LEVEL
OF VOLATILITY IN THE MARKET
PLACE, WHAT TRADERS ARE PRICING
IN INSURANCE FOR POOR FOLIO THE
S&P 500 HERE THERE IS AN AVERAGE
THERE.
WE ARE WAY ABOVE THE AVERAGE
ENDED AS A SUSTAINED HIGH-LEVEL
OVERTIME.
VERY UNUSUAL.
NEIL: I'M WONDERING IS -- IT
SPEAKS TO MAYBE THE
COMPLICATIONS OF THE MARKETS
THAT DESPITE UNDERLYING STOCKS,
THERE'S NEW DIMENSIONS TO IT IN
NO WAY TO PLAY THROUGH ALL OF
THIS VOLATILITY, BUT IT CAN GET
MIND NUMBINGLY.
>> YOU CAN, BUT SIMPLE PROTECT
STRATEGIES ARE NOT COMPLICATED.
THAT'S THE FIRST THING THAT'S
TAUGHT.
HOW DO YOU ENSURE A PORTFOLIO.
ANY SCENARIO THAT YOU AND I CAN
DISCUSS IN ANYTHING THAT'S
CONCERNING YOU IN THE MARKET
GOING FORWARD, THERE IS A
STRATEGY TO MINIMIZE THAT RISK.
THEY CAN BE VERY SUBTLE.
NEIL: iPAD AND S&P 500 AND I'M
SUDDENLY CONCERNED NOW THAT MY
UNDERLYING INVESTMENT IS IN
TROUBLE.
>> SIMPLY TO ENSURE ALL THE WAY
TO COMPLEX STRATEGIES USING
VOLATILITY CONTRACTS TO HEDGE
OUT THE REST.
NEIL: SEEMS LIKE BY THE SECOND
GETTING IN AND OUT OF VOLATILITY
, HOW IS THAT BECAUSE
IT CAN BE SO.
>> THE VOLATILITY OF VOLATILITY
IS VERY.
THERE'S A HIGH VOLATILITY TO
VOLATILITY.
EVEN IF WE PUT THAT ASIDE, THE
DEDICATED LIQUIDITY PROVIDERS,
PARTICIPANTS IN THE MARKET ALL
DAY LONG ARE PRICING THE
INSURANCE OVERTIME.
WHAT THEY'RE TELLING YOU IS VERY
TRANSPARENT.
I'M REALLY, REALLY UNSURE OF
WHAT'S GOING TO HAPPEN IN ANY OF
THE THREE TO FIVE MAJOR GLOBAL
DRIVERS IN THE U.S. MARKET I'M
REALLY UNCERTAIN.
I'M REALLY UNCOMFORTABLE.
IT ELEVATED, MORE EXPENSIVE THAN
IT WOULD'VE BEEN ALMOST ANY
POINT IN 2017.
NEIL: WHEN DID THINGS PICK UP?
I WOULD IMAGINE THE ACTIVITY,
THE MORE INTERESTING PRODUCTS
YOU OFFER.
WE'VE SEEN CERTAINLY OVER THE
LAST COUPLE OF MONTHS ALL ABOUT
PICKUP.
>> OCTOBER WAS A RECORD MONTH
OVERALL.
FEBRUARY WAS BASICALLY THE SAME
10% CORRECTION IN THE MARKET.
NEIL: PEOPLE FORGET THAT.
>> IT HAPPENED IN A REALLY SHORT
PERIOD OF TIME.
IN THE BEGINNING OF OCTOBER
THROUGH TODAY WE HAD A LONGER
AND SUSTAIN --
NEIL: WORTHIER MARKET SCENE
RIGHT NOW?
>> THE PRICE THAT THE MARKET IS
SELLING INSURANCE FOR THE 500 IS
CHEAPER THAN WHAT WE'RE
REALIZING EACH AND EVERY DAY.
LET ME GIVE YOU AN EXAMPLE.
IF AN HISTORIC LEVEL OF
VOLATILITY IS 17.
IT'S AN EXAMPLE OF VOLATILITY.
THAT'S IMPLYING A 1% MOVE IN THE
UNDERLYING.
MOVE VOLATILITY UP TO 24 THE
MARKETS EXPECTING MOST OF THE
TIME A ONE-POINT 5% IN THE
MARKET.
THAT'S A BIG, BIG CHANGE ON
EXPERT NATION AND THAT'S PRICED
IN THE MARKETPLACE AND WE SEE
OPTIONS ELEVATED IN THE PRICE.
NEIL: BUT IT'S ALSO INDICATIVE
OF A SCARIER MARKET.
>> IS A SCARIER MARKET.
THE BIG DRIVERS TO MAJOR CHANGE
THERE IS NO CERTAINTY.
NEIL: HOW IF THEY PLAYED OUT HOW
TO LOOK AT WHAT'S GOING ON WITH
BREXIT, WHAT'S GOING ON IN
FRANCE, GERMANY TO SLOW DOWN,
CHINA, GOD ONLY KNOWS.
>> THEY'RE ALL IN THE CATEGORY
OF NO UNKNOWNS.
WE KNOW THEY'RE OUT THERE, BUT
THERE'S STILL MAJOR, POTENTIALLY
DISRUPTIVE MOVES TO THE OVERALL
MARKET.
THAT'S WHAT THE IMPACT IS AND
WHAT WOULD JUST CANNOT SEE
THROUGH YET.
>> OF THE GOVERNMENT SHUT DOWN A
STAIRWAY TO PLAYED OUT?
>> THERE'S VARIOUS DEGREES OF
SHUTTING DOWN IN THE EARLY
STAGES.
WE'VE SEEN THAT BEFORE.
I REALLY THINK THAT THE MARKET
IS AS CONCENTRATED ON MORE TRADE
TALKS.
THE RATE OF CHANGE OF OUR OWN
INTEREST RATES HAVE MANY MORE
MACROECONOMIC DRIVERS THAT I
THINK WE CAN SEE THROUGH A
SHUTDOWN.
THE MIXER WAS THE FIRST THING
YOU LOOK AT EVERY MORNING?
>> I LOOK AT THE LEVEL OF THE VX
IN THE FUTURE PRICES.
NEIL: HAD TILLY, CHAIRMAN AND
CEO.
THIS SPEAKS OF OUR TIME IN THE
ENVIRONMENT WE ARE WRITTEN THAT
PEOPLE GET NERVOUS ABOUT THE