Wall Street's 'fear gauge' is doing something unusual. What it means

the vix is stuck near 20 even as the s&p 500 hit record highs thursday — up from where it was five days ago when the index traded 100 points lower. stocks and the fear gauge usually move together about 20% of the time, but when it lingers, something's off under the surface. one explanation: investors doubt the new highs and are hedging against risks like the iran war and crude oil. if that's the case, expect near-term pullbacks as realized volatility catches up. a more bullish read — visible in options around earnings — is that traders are buying expensive upside calls in the names leading the rally. total call premium in the vaneck semiconductor etf (smh) is 25% bigger than puts, even though put volume is higher. one example: marvell technology stock has doubled since earnings last month, but a trader just spent $2.4 million on nearly 1,700 contracts expiring june 18 at a $180 strike, betting on another 10% rally. that kind of enthusiasm keeps options prices inflated, which may explain why the vix won't drop.