Even as stocks see a soft start to the year, investors don't seem to be getting too fearful. In fact, the market's "fear gauge" fell Monday to a low touched only once in the past 10 months, and that could give investors a great chance to get protection.
The CBOE Volatility Index, or the VIX, charts the prices of options on the S&P 500. And because people more commonly use options to get downside protection than upside exposure, an upward-moving VIX tends to paint a portrait of investors clambering for protection.
In October 2008, the index touched 89.53, but is now trading at around 12. The VIX has dropped 10 percent this year, which is unusual, given that the S&P 500 is also down, and the two indexes have a strong inverse correlation.
(Read more: Volatility could come back big-time—here's why)
"It's kind of rare to see markets go down and volatility to drop," said Brian Stutland of the Stutland Volatility Group. "That tells me that protection has gotten kind of cheap. You're getting good value here by getting some sort of protection."
Perhaps that was the thinking of whoever executed Monday morning's biggest options trade on the VIX: the purchase of 40,500 April 28-strike VIX calls for about $0.45 each. This trade, which cost some $1.8 million, will make money only if the VIX is trading above 28.45 in April—which would be the highest since 2011 and more than double present levels.