The stock market’s recent tumble has proved to be quite beneficial for exchange traded funds (ETFs) based on CBOE Volatility Index futures contracts.
The CBOE Volatility Index, or VIX, has jumped about 20% this week from its 52-week low just last week, according to DailyMarkets. Despite the rise in the VIX, overall volume remains on the lighter side, indicating a subdued aggressive style of portfolio hedging. [VIX ETFs: How Low Can They Go?]
Larry McMillan, president of McMillan Analysis Corp., comments on shift in the VIX, stating that “this is the problem area, a potential new uptrend in the VIX,” reports Rodrigo Campos for Reuters. “The longer it holds above 16, the more the danger (for the stock market) grows,” adds McMillan.
For more information, visit our VIX category.
- ProShares VIX Short-Term Futures (NYSEArca: VIXY)
- ProShares VIX Mid-Term Futures (NYSEArca: VIXM)
- iPath S&P 500 VIX Short-Term Futures ETN (NYSEArca: VXX)
- iPath S&P 500 VIX Mid-Term Futures ETN (NYSEArca: VXZ)
- VelocityShares Daily Inverse VIX Short-Term ETN (NYSEArca: XIV)
- VelocityShares Daily Inverse VIX Medium-Term ETN (NYSEArca: ZIV)
- UBS E-TRACS Daily Long-Short VIX ETN (NYSEArca: XVIX)
- VelocityShares Daily 2x VIX Short-Term ETN (NYSEArca: TVIX)
- Daily 2X VIX Medium-Term ETN (NYSEArca: TVIZ)
Max Chen contributed to this article.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.