REX Shares became a new issuer to the Bats Exchange on Tuesday with the launch of two new exchange traded funds (ETFs).
The pair of ETFs are the REX VolMAXX Long VIX Weekly Futures Strategy ETF (BATS: VMAX) and the REX VolMAXX Inverse VIX Weekly Futures Strategy ETF (BATS: VMIN).
VMAX seeks to provide investors with exposure to the implied volatility of the broad-based, large-cap U.S. equity market. VMIN seeks to provide investors with inverse exposure to the implied volatility of the broad-based, large-cap U.S. equity market.
These two funds set a number of firsts for volatility-focused strategies, which allow investors to express directional views on the widely-followed CBOE Volatility Index (the “VIX”).
VMAX and VMIN are the first regulated investment company funds to invest in VIX futures, and seek to track movements in the VIX Index by maintaining a weighted average time to expiry of their investments in VIX futures contracts of less than 30 days at all times.
Greg King, Founder and CEO of REX Shares, said he believes the two funds are what investors have been asking for: ETFs that get closer to spot VIX.
“Thanks to recent innovations at the CBOE Futures Exchange, we are able to deliver these products to market,” King said.
[related_stories]CBOE introduced weekly expirations for VIX futures in July 2015. The shorter time horizon found with weekly VIX futures contracts should result in a higher correlation and beta to the true daily price of the VIX Index.
The long fund (VMAX) seeks opportunities that arise should the VIX spike upward while the inverse fund (VMIN) seeks to gain as the VIX falls. Both funds will be actively managed with the objective of being fully invested in VIX futures at all times.
Laura Morrison, Senior Vice President, Global Head of Exchange Traded Products at Bats, said the team at REX Shares has deep experience in the ETF industry.
Morrison added they have a track record of creating ETFs that solve challenges faced by today’s investors.
“We’re thrilled to have their two new innovative products listed on the Bats ETF Marketplace and we look forward to a strong partnership,” Morrison said.
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