Wall Street’s measure of fear might not be as alarming if one focuses on long-term investments.

According to Charlie Bilello, the chief markets strategist at Creative Planning, the CBOE Volatility Index (^VIX) experienced its largest three-day surge of the year recently. On April 7, the VIX hit its highest point in 2025 at 46.98 as international markets responded to worries over Trump’s tariffs.

Market Performance of VIX

From April 4 to April 7, the VIX surged by 118%, making it the fifth-largest increase recorded since 2014, based on Bilello’s analysis.

Interestingly, although traders frequently utilize the VIX as a short-term indicator of market fear, historically, its extreme levels have suggested a bullish outlook for stocks over the long term.

After analyzing VIX spikes over the last decade, which ranged from 63% to 176%, Bilello found that the average one-year return for the S&P 500 (^GSPC) amounted to around 4.4%. Furthermore, five years following the VIX increase, the S&P 500 has shown an average return of 10.2%.

“Bilello mentioned on X that ‘high volatility and fear present a chance,’ seeking to explain the beneficial aspects associated with a measure frequently seen as bearish.”

Currently, the VIX is at 40. In line with Bilello’s findings, buyers have started to surface in the currently depressed stock market.

The Dow Jones Industrial Average (^DJI) surged by 3.4%, gaining over 1,300 points at the opening, as traders seized on reports that the Trump administration has begun trade talks with Japan and other nations. Notable rises are also happening in the S&P 500 (^GSPC) and the Nasdaq Composite (^IXIC).

This development is interpreted as an indication that Trump’s widespread tariffs, which are expected to be implemented on Wednesday, will serve as a negotiating strategy.