FYI: Fear levels are rising on Wall Street, prompting exchange-traded products tied to the Cboe Volatility Index (VIX) to spike in October.
In the month-to-date period ending Oct. 29, the S&P 500 plummeted 9.3%, pushing the VIX to around 25, the loftiest level since April. In turn, the $1.1 billion iPath S&P 500 VIX Short-Term Futures ETN (VXX), the largest volatility ETP on the market, surged more than 50%.
VXX isn’t the only ETP tied to the VIX that is soaring this month. The $817 million VelocityShares Daily 2x VIX Short-Term ETN (TVIX) more than doubled, returning 113.5% in the month-to-date period.
(Note: VXX will expire in January 2019 and will be replaced by the iPath Series B S&P 500 VIX Short Term Futures ETN (VXXB).
Regards,
Ted
https://www.etf.com/sections/features-and-news/understanding-spiking-vix-etfs?nopaging=1
