ncroadrunr 8:55 am on Wednesday, August 16, 2017

VIX

I notice VIX-X moved 5% today while UVXY and SVXY have moved less than 1%. Are we likely to see a stronger move when these ETFs do move? Or are they signaling a likely reversal of VIX-X? Anyone else analyzing these securities?

Jeff 10:03 am on Wednesday, August 16, 2017

SVXY and UVXY reflect the VXX, not the VIX.
hcgdavis 10:59 am on Wednesday, August 16, 2017

I am not an expert on this but I also think there is gearing because of the hedging done to make UVXY and SVXY leveraged.
With the last 2 big spikes in the VIX I noticed that as the VIX moved, the leverage became exponential. A 3 point move in the VIX resulted in a 21 point move in SVXY indicating 7-1 gearing. However beyond that level it seemed to stop. Smaller moves in the VIX result in smaller moves on UVXY/SVXY but still leveraged/geared.
I’m still experimenting with this as I am relatively new to the VXX trades but that seems to be how it works.
Option Iceman 11:00 am on Wednesday, August 16, 2017

August VIX futures expired this morning. September/October futures contango is what determines the moves in $VXX, $SVXY and $UVXY.
http://vixcentral.com/
ncroadrunr 11:10 am on Wednesday, August 16, 2017

Thank you for the informative feedback. I’ll start watching the VXX instead of the VIX-X.