XIV, which more than doubled in 2012 and again in 2013 as volatility slid, is a play on VIX futures that are at the front end of the futures curve, meaning the ETN is more prone to be whipsawed as volatility increases.  XIV is also currently in backwardation, the scenario where as expiration date nears, futures contracts rise to higher prices than where they resided when expiration was further out. [Rising Volatility Makes These ETNs Attractive]

In another sign of soaring interest in volatility strategies, the VelocityShares Daily Inverse VIX Medium Term ETN (NYSEArca: ZIV), a more docile answer to XIV, has seen its shares outstanding count nearly double in the past six months.

Over the past three years, ZIV has outperformed XIV by a wide margin while being significantly less volatile.

Chart Courtesy: ETF Replay