Asia markets going through calm before the storm?

READING the headlines recently, you'd think the world was falling apart. But stock market volatility in Asia, particularly Hong Kong, is virtually non-existent.

The city's Hang Seng Index ended January up 6.2 per cent, its best performance for that month since 2012, as investors continued to bet on reflationary policies by President Donald Trump. Sixty-day volatility, meanwhile, dropped to an almost two-year low on Wednesday.

That calm has seeped into expectations of future swings as well. The implied volatility of index options also decreased to their lowest since March 2015 last week. A closer look suggests this can't last. When volatility was this low previously, it almost doubled in a matter of days.