Market volatility has fallen to notably low levels, but earning season could soon change all that. Over the past 10 years, the emergence of first-quarter earnings reports has generally corresponded with a rise in volatility.
In the four weeks preceding Q1 earnings season, the CBOE Volatility Index has tended to fall 4.7 percent.
Meanwhile, during earnings season — here defined as the period between JPMorgan's report and the date four weeks hence — the VIX has risen an average of 4.9 percent.
Median readings show a similar divergence; the VIX's median performance in the pre-earnings period is a 4.4 percent drop, while its subsequent median move is a 1.3 percent rise.