Keeping it Simple with Simplify Asset Management Keeping it Simple | Ep. 53: Convexity Squared
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Dec 10, 2025 
Noel Smith, Chief Investment Officer and Founder of Convex Asset Management, shares his vast expertise in options and volatility strategies. He dives into how VIX tenor shifts are changing market dynamics and discusses the impact of concentrated stocks on volatility dispersion. Noel analyzes recent volatility spikes, market maker behavior, and the implications of the Volcker rule on market making. He emphasizes the evolving role of zero-DTE options and offers practical strategies for navigating market fear while highlighting the importance of relative value in smaller stocks.
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Volatility Sourced Across New Tenors
- The rise of zero-DTE and weekly options shifts where volatility is sourced, changing the VIX's time slice and market dynamics.
- That attention reallocation creates dislocations and trading opportunities across tenors and products.
Dispersion Depends On Correlation, Not Just Vol
- Index volatility behavior depends heavily on correlation between single names and the index, not just single-stock vol levels.
- Dispersion trades profit when single-name vol diverges from index vol, creating a three-way payoff in ideal scenarios.
Act On Signals, Not Narratives
- Ignore seductive narratives and act on measurable market signals when volatility spikes.
- Disentangle skew, absolute vol, and VIX futures moves, then decide to add, trim, or fade hedges accordingly.