How to calculate CBOE VOLATILITY INDEX (^VIX)?

Question

How to calculate CBOE VOLATILITY INDEX (^VIX)?

Answer 1

isnt it just

high price- low price

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     low price

Answer 2

As you might already know, the VIX is a widely used measure of market risk and measures the "fear" (aka volatility) in the market.  

It is constructed using the implied volatilities of a wide range of S&P 500 index options. This volatility is meant to be forward looking and is calculated from both calls and puts.

Often people use it as an investor "fear gauge".

Hope that helps!