Market Insider

The 'fear index' is falling, and that's a good sign for stock pickers

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In another sign that stock picking may be back this year, the so-called fear index has fallen to its lowest level in more than two years.

The CBOE Volatility Index (.VIX) hit 10.30 on Friday, a fresh low going back to July 3, 2014, and near levels not seen since before the financial crisis. That low volatility comes from stocks moving less as a huge group and more on their own individual merits — and that's good for investors who think they can pick winners.

"You're starting to see a lot more differentiating between the stock market, and that's driven the correlations down, and that's kept volatility low," said Peter Tchir, head of macro strategy at Brean Capital. "That means it's finally the stock picker's market."