Record short gamma on VIX. Read that again.

The VIX dealer gamma just fell to about ‑$39 million – the lowest figure we’ve seen since we started tracking it in 2021. In plain language, dealers are heavily short gamma on the VIX. That means they have to chase any volatility swing instead of smoothing it, so a spike tends to get bigger rather than being absorbed.

Most of the gamma exposure is clustered around the 25 and 47.5 strike levels, with the current VIX sitting right between them. If the index moves toward either of those pockets, dealers’ hedging activity will push the move further.

Bottom line: the market’s usual volatility dampers are out of whack. Even a modest bump in volatility now has a much higher chance of blowing up into a full‑blown surge.