The FTSE volatility index shot up this morning as the markets reacted to the shock of the Libyan unrest. The index is a measure of anxiety among investors.
Set up in June of 2008, the index uses prices of out-of-the-money FTSE 100 call and put options - essentially predictions of where the market is going to go in the next 30 days.
It measures the variance between the current level and where people think the market will be - so if derivatives investors are expecting a big fall or a big rise, the volatility index will go up.
Today's level - currently 13% up at 21.5 - is actually historically quite low for the index, suggesting investors do not see the Libyan crisis as a huge issue.
On the other hand, the index's history has been marked by some extremely turbulent events. It hit a peak in November 2008 during the financial crisis and the collapse of Lehman Brothers, hitting 70 towards the end of 2008.
It was up to 40 last summer too during the sovereign debt crisis.
Today's level is only the highest since November - so no reason to panic just yet.
