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The Volatility Index—or VIX—is heading into a danger zone…

Investment bank Goldman Sachs just issued a new report on market volatility. Goldman sees the VIX now oscillating in a range between 18 and 26… an important new level.

Over the last three U.S. recessions, the VIX averaged 26. As this issue goes to press, the VIX hovers right around 26.

Now, this doesn’t mean a recession is imminent… but it does mean more people fear one. Don’t be surprised to see the VIX spike even higher over the ensuing days.

Chart

  What’s more important than the movement of the VIX is how you interpret it…  

Take an honest assessment of yourself. If you’re scared when volatility rises, that’s a clear indicator your investments are unbalanced. You’ve “cheated” too much to one asset class… or overloaded your portfolio with positions that are too large.

This is why PBRG preaches radical risk management: the Palm Beach Three-Legged Stool of Safety. If you follow this protocol, the markets should never scare you—ever.

You know if equities fall, the dollar will rise (and you’ll have a stockpile of dollars). Or if panic strikes, gold will spike (your chaos hedge).

You’re “hedged” across all asset classes. And that financial fortress provides you “sleep-at-night” protection… in any market environment.

Bottom line: Panics and corrections are opportunities. If you’ve managed risk, VIX spikes will have you salivating with opportunity… not shaking with fear.

If the VIX is making you salivate right now… read our next item on how to convert others’ fears into instant cash and a safe 18% return…