Miller Magazine Issue: 138 June 2021

93 MARKET ANALYSIS MILLER / june 2021 Will corn still run the market or wheat be- came the queen? Defiantly we are staying just in front new portion of weather surpris- es and this story not over. So, let’s turn the page for the new chapter. It will not be corny. After a four-month growth in the US stock market, inves- tors are beginning to noticeably be nervous and insure themselves against a sharp decline in quotations. The CBOE Skew Index*, often referred to as the Black Swan Index, has skyrocketed to a record high since August 2018. It is similar to the VIX Fear Index. The main difference between the VIX and Skew is that the VIX is based on the implied volatility of the S&P 500 around the near-the-money (ATM) strike, while Skew takes into account the implied volatility of out-of-the- money (OTM) strikes. Like the VIX Index, the Skew Index can serve as an indicator of investor sentiment, but it measures the so-called “tail risks,” that is, the risks that the price of an asset or portfolio of assets will change by more than three standard deviations from the current price. Such dynamics in the Skew index suggest that investors are worried about the collapse of the S&P 500. The rise in inflation, which be- came one of the main market topics in May, may prompt the Fed to start cutting stimulus earlier than expected. Bulls are trying to "feed" the grain market with weather news: in the east of the United States, it rains with thun- derstorms, in Brazil the drought continues to damage corn crops, in Ukraine rains may affect the quality of the future harvest, in Turkey due to the drought the forecasts Not corny Elena Faige Neroba Business Development Manager Maxigrain