However, the stock market can be more volatile, meaning that stock prices can fluctuate rapidly and unpredictably, and it doesn't provide cash flow like rental income.It's important to consider your individual goals and risk tolerance when deciding whether to invest in real estate or the stock market, or a combination of both.

You don't have any volatility issue with down years.

Many Chicagoans are moving to Indiana putting pressure in the market and driving prices/rents/volatility upwards.) 

Now on derivatives, any half wit or better in the financial investment sector will ALWAYS speak to the significant risk factor and volatility to ANY derivatives investing, ANY.

Buy high-quality liquid assets that can be disposed of in event of significant currency/bond market volatility to raise cash and avoid deflation.

For those reading this comment, and interested, the book "The Wealthy Code" does a good job at covering a lot of this stuff (perhaps at an elementary level for many experienced investors, but as someone still on the journey of educating myself in matter of real estate financing and how to really think about debt, risk, volatility, etc, it was eye opening for me).The author at one point talks about equity like this, and I found it beneficial (quoting here):Do you think this is a good investment?

More volatile, but an interesting investment and trend.   

There is higher appreciation on the coasts, but also considerably more volatility.

The market doesn’t always go up and you work and live in one of the most volatile real estate markets in the country.

There is also added volatility.