Storm is coming? Some people in the market are betting that the US volatility index VIX will surge by 1100%.

The CBOE Volatility Index (VIX), also known as the "fear index," has not exceeded 35 points this year. However, some traders are now betting that it will surge to 180 points in the coming months.

According to the latest reports, shortly after the start of regular trading on Thursday, a trader placed a bold bet of $30,000. If the VIX index surges more than 1100% before the expiration date on February 14th next year, the bet will pay off.

In fact, the VIX has never exceeded 100 points since its launch in 1993. The closest it came was during the 2008 financial crisis when it reached a high of 89.53 points, which is still less than half of the current bet.

This is not the first time traders have placed bets on highly unlikely events.

The same trader or others have already bought over 20,000 open contracts of VIX December options at the same strike price. In the past few weeks, 5,000 of these December options contracts changed hands twice, both times when the VIX broke free from its summer slump and surpassed 15.

Regarding this, Steve Sosnick, Chief Strategist at Interactive Brokers, said:

The only logical reason is that they are shorting lower strike call options, which would generate some significant profits for them, or they are getting a discount by going long higher strike call options, even if it means losing a crazy amount of money.

The "fear index" reflects the implied volatility of the S&P 500 index for the next 30 days. The higher the number, the more pessimistic investors are about the future of the US stock market, which may trigger market hedging. Conversely, a lower number indicates that investors believe the stock market will perform steadily and there is no need for excessive caution.