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 …
The prices of SPY (S&P 500) starting in March of 2003 and of 2009 have tracked each other surprisingly well over a 6 year period. The current market has managed higher highs each year, but then that advantage has evaporated by the Christmas holidays. This year the market has already achieved the higher highs part of the pattern—and for the first time since this …
How does VXX trade? How is VXX’s value established? What does VXX track? How does Barclays make money on VXX? VXX’s 2022 share creation crises On 14-Mar-2022, Barclays suspended share creations of VXX due to an administrative screw-up. During the suspension, VXX traded at premiums as high as 52% over its IV price. This premium over the IV price can develop because share creations are …
Many people seem to believe that the CBOE’s VIX Futures market is attempting to predict upcoming CBOE VIX® values. I think they are mistaken. Most futures prices have very little to do with predicting the future. Futures contracts were invented to allow producers/consumer of commodities to limit their business risk by locking in future prices. In exchange for eliminating price risk, they give up the potential for increased …
