So, when observing the VIX, the "fear factor" is determined by the degree in which SPX implied volatilities, as measured by the VIX, are priced above the actual (historical) volatility of the SPX.

FORBES: Magazine Article

Realised volatility looks at the actual movements of prices in financial markets.

ECONOMIST: Buttonwood

While leveraged volatility ETNs do come closer to replicating the actual performance of VIX, these instruments are really only effective when held for short periods of time (as volatility lag eats away at the returns over time).

FORBES: Profiting From Fear With Exchange-Traded VIX Notes