Could somebody help me understand if the VIX is a leading or lagging indicator.
From the CBOE whitePaper ( https://www.cboe.com/micro/vix/vixwhite.pdf). I've understood that the VIX tries to calculate the 30 day expected volatility.
This would make me assume that it is a leading indicator looking ahead. Yet the calculations happen on the time that the options are available. Meaning as soon as there is new information this will change and so will the VIX.
Example nobody (some better than others maybe) see a market downturn in advance when the VIX is still nice and smooth. Then when disaster strikes the VIX goes up which leads me to believe that it is a lagging indicator.
Could somebody help shed some light on this for a very confused person.
Thank you so much in advance!
P.S this might be a real dumbass question but if the VIX has a more or less known lower limit then why not keep going long on it until it eventually spikes?