For a security doomed to decrease in value over time Barclays’ VXX does amazingly well. Its volume averages over 8 million shares per day and its assets under management had stayed around $800 million to $1.5 billion until an ugly 2022, were it had to cease share creations for 6 months due to a regulatory problem. Now its assets are at $300 million, still not …
Based on searches that lead people to Six Figure Investing, these are the top 10 questions people ask about volatility investing: How can I buy/trade/invest in the CBOE’s VIX® index? The short answer is that you can’t. No one has figured out how to do this economically. However, there are quite a few investment approaches that allow you to trade in volatility, including futures, options on …
Update TRSK & SPXH were shutdown in March 2018, probably because they never gained enough assets to be profitable for the issuer. In general, these fund performed as expected. They likely would have really done well in a major correction or bear market but that didn’t happen during their lifetimes. Their main weakness is that they tended to lose value when volatility makes sudden shifts. …
Update Trade Options Weekly no longer appears to be around, but there are people still providing the same basic strategy (e.g, 5Percent{PerWeek.com). Be aware these are high risk strategies Original Post If you do any amount of browsing on stocks and options you’ve seen ads for services that tout weekly percentage gains of several percent. I’ve never really been tempted to investigate these—I reflexively …
Update: On October 6th, 2014 the CBOE changed the calculation method for the VIX to include SPX weekly options, the old VIX calculation is still being reported using the VIXMO (VIX Month Only) ticker. The new calculation uses the VIX ticker. For more on the new calculation see “Calculating the New VIX“. The movements of the CBOE’s VIX® are often confusing. It usually moves the opposite …
