As the domestic stock market plummeted again today (the 23rd), the KOSPI 200 Volatility Index (VKOSPI), often referred to as the "Korea-style fear index," has once again neared the 90-point mark.

On this day, the VKOSPI soared to as high as 89.69 during intraday trading, coming within close range of the 90 level.

At the market close, it stood at 89.41, up 2.35% from the previous session.

The KOSPI index closed at 8,203.84, down 910.71 points (9.99%) from the previous day.

The KOSDAQ index also finished at 891.52, down 76.88 points (7.94%) from the previous session.

Amid the sharp downturn, sidecars—which temporarily suspend program sell orders—were triggered in both markets this morning, and a "circuit breaker" was activated in the afternoon to temporarily halt trading on the KOSPI market.

The KOSPI recorded its largest single-day point drop in history, falling 910.71 points in a single day.

The index reached a high of 9,175.45 early in the session before sliding to 8,203.84 at the close, marking the largest intraday volatility (a difference of 971.61 points) ever recorded.

Consequently, the VKOSPI also resumed its upward trend.

The VKOSPI had previously surged to 83.58 during intraday trading on March 5, immediately following the outbreak of the U.S.-Iran war, before showing signs of stabilization for a period.

On April 14, it had dropped to as low as 46.54 during the session.

However, as the domestic stock market has seen volatility of around 8% at times this month, the VKOSPI has continued its high-altitude flight.

It closed at 91.23 on the 9th, surpassing the 90-point mark, and remained above the 80-point level for six consecutive trading sessions thereafter.

On the 15th, it hit an all-time high of 94.25 during intraday trading.

Although it broke that trend and fell to 79.65 at the close on the 17th, it has since returned to an upward trajectory.

Yesterday, it fluctuated around the 90-point level again, rising to 90.60 during the session.

The VKOSPI is an indicator that annualizes the expected volatility of the KOSPI 200 for the next 30 days, as reflected in the prices of KOSPI 200 options.

According to the "KOSPI 200 Volatility Index Methodology" of the Korea Exchange, the index is calculated by using the settlement month items listed on the KOSPI 200 options market to determine the volatility of the KOSPI 200 with a residual maturity of 30 days.

It is interpreted that the higher the option prices, the more market participants perceive a high possibility of price fluctuations for the KOSPI 200 in the future.

A VKOSPI of 90 points signifies an annual volatility level of 90%.

When simply converted into daily volatility based on the standard 252 trading days, this corresponds to an expected daily fluctuation rate of approximately ±5.7%.

(Photo: Yonhap News)