VIX Workshop

An interesting picture is emerging among the leveraged VIX funds lately. ETFs such as UVXY and TVIX have not been going down at the same rate many have grown to expect. Since July 26, UVXY has not created a new low. This is the longest such period so far this year. In fact it's the longest period since February 2016. What's causing this unusual behavior? VIX hit an all time intraday low of 8.84 on July 26, 2017 . Since then, the VIX has had a few spikes along the way, each time receding to a slightly higher floor, and as of the writing of this article on August 30, rests just above 11. In the span of a month, VIX has essentially risen 25%. Many new traders of the long volatility ETFs are starting to describe “support” on UVXY around 30 or 30.50. And in a way, they are not wrong. The ETF has not had a close below 30 in over 3 weeks, and UVXY certainly seems to bounce off of this level each and every time it has come close in the month of August. UVXY from July 2...

A question I often see that comes up in online chats and tweets, especially during an overnight market event is how do I know what the value of UVXY is? Afterhours closes at 8pm ET so it's impossible to know what UVXY is doing until the premarket opens the next day, right? Absolutely not! Once you have a few pieces of information, you can set up a spreadsheet fairly easy and determine for yourself what the value of UVXY, TVIX, or any other VIX Product is during the overnight hours. It even works for the short funds like SVXY and XIV, just with a different calculation. So what do you need to get started? First it helps to understand how UVXY derives its value. UVXY is an average of the first two months of VIX futures. In most cases, paying attention to the percentage change in these futures from the previous close is all you need to determine the value of UVXY. So here's the list of what you need: Daily settling price of VIX futures Closing price of UVXY.IV at ...

I'm a veterinarian. So why am I starting a blog about trading? I guess it's because I have an obsession with numbers. Which is weird, I think, at least for a veterinarian. No one probably ever wanted to be a vet growing up and said hey I actually like doing my business's own bookkeeping, filing my taxes, or analyzing market trends. I'm supposed to be doing surgery, and playing with puppies, and healing the sick. How could staring at a spreadsheet possibly be more interesting than that? And don't get me wrong, I love that part of my job. Nothing beats the feeling seeing a beloved pet pull through an illness because of a team effort I helped direct at the clinic. Yet there's some kind of appeal in seeing a numerical representation of emotion. At least that's how I see trading. One minute the price of something is $25. The next minute it's $25.50. Why? Suddenly someone with a few hundred shares thought it was worth more than what the last guy sold it ...