The VXD measures the implied volatility of the Dow Jones Industrial Average. Basically, the VXD is a measure of the fear and uncertainty associated with the DJIA. If the VXD reading is low (0-20), it indicates that individuals are comfortable and fear levels are low. A high VXD reading (above 20) indicates fear and uncertainty in the market place, which results in a more volatile market environment.
VXD is commonly used in stock trading, day trading, options trading, and futures treading,
Here' s a look at the 2 year chart of the VXD for your visual entertainment. As you can see, it's been a wild ride.
Related terms: CBOE, VXN, VIX