Option Iceman 8:38 am on Tuesday, June 28, 2016

$VXX $SVXY $UVXY – YTD…

$VXX $SVXY $UVXY – YTD performance on Volatility stocks.
This is why we make money selling calls on all of these

vxxkelly 8:56 am on Tuesday, June 28, 2016

Thanks. Pretty interesting seeing the overlay-ed charts. $SVXY is supposed to track the daily inverse of $VXX, but this show’s what we’ve been talking about for quit a while now, where it only really performs during long’ish periods of low’ish volatility. With $VXX down 16% and $SVXY couldn’t even break even, that’s pretty telling. $UVXY continues to demonstrate that it is incredibly efficient at going down. If we assume that we will continue to have volatile markets for the foreseeable future, then on $SVXY where we used to be short many, many more puts than calls, it looks like we’d be better off keeping that ratio closer to 1:1. I think most of us have transitioned our $NUGT trades from almost entirely short calls to now close to 1:1 ratio. $SVXY trading might benefit the same way. Some day soon, I’m sort of expecting another $UVXY reverse split.