Call option bets on the VIX this week soared to a record high 8.4M contracts at the CBOE. "A lot are buying in size," says Mike Palmer, who sits at the center of the VIX pit. With volatility so low, speculators "can get a lot of bang for their buck." About 81% of VIX options trading yesterday was in call options.
After a 7.2% jump Thursday, the VIX is up another 14% today, but - at 15.67 - still well below the 20-year average of 20.50.