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the trade has been selling near month ITM vix calls and buying May, June, July vix calls for cheap.Cobra wrote:the problem is most likely your broker won't allow you to short TVIX as it's almost free money. I did try but no luck, it's not allowed.TraderGirl wrote:VIX products may be getting dumped because of the issues surrounding TVIX, people are getting nervous in holding too much risk, so they could be dumping. If we continue to have small moves in the mkt (10-15 spx pts) then volatility is not there, and these products may continue to go down. The best trades this year were probably shorting VIX products. I personally will be staying away until June/July and then assess at that time whether the instruments have any merit...Cobra wrote:no idea. I never figured out VIX and its futures relationships, so I assume they're totally different things. and VIX doesn't work nowadays anyway.stepture wrote:Cobra,
Why does XIV increase so much? Does it mean something?
Thanks
Sounds like a good trade, just stay away from calls around april 2-5...IMHOjarbo456 wrote:the trade has been selling near month ITM vix calls and buying May, June, July vix calls for cheap.Cobra wrote:the problem is most likely your broker won't allow you to short TVIX as it's almost free money. I did try but no luck, it's not allowed.TraderGirl wrote:VIX products may be getting dumped because of the issues surrounding TVIX, people are getting nervous in holding too much risk, so they could be dumping. If we continue to have small moves in the mkt (10-15 spx pts) then volatility is not there, and these products may continue to go down. The best trades this year were probably shorting VIX products. I personally will be staying away until June/July and then assess at that time whether the instruments have any merit...Cobra wrote:no idea. I never figured out VIX and its futures relationships, so I assume they're totally different things. and VIX doesn't work nowadays anyway.stepture wrote:Cobra,
Why does XIV increase so much? Does it mean something?
Thanks
I can't say the following is absolute, but it has a decent chance:TraderGirl wrote:VIX products may be getting dumped because of the issues surrounding TVIX, people are getting nervous in holding too much risk, so they could be dumping. If we continue to have small moves in the mkt (10-15 spx pts) then volatility is not there, and these products may continue to go down. The best trades this year were probably shorting VIX products. I personally will be staying away until June/July and then assess at that time whether the instruments have any merit...Cobra wrote:no idea. I never figured out VIX and its futures relationships, so I assume they're totally different things. and VIX doesn't work nowadays anyway.stepture wrote:Cobra,
Why does XIV increase so much? Does it mean something?
Thanks
Very nice explanation Mr. Walsh. For a while It has seemed to me that writing options in this environment would be lucrative. Perhaps I've been right and we're seeing a welcome dose of free enterprise in the market.SWalsh wrote:I can't say the following is absolute, but it has a decent chance:TraderGirl wrote:VIX products may be getting dumped because of the issues surrounding TVIX, people are getting nervous in holding too much risk, so they could be dumping. If we continue to have small moves in the mkt (10-15 spx pts) then volatility is not there, and these products may continue to go down. The best trades this year were probably shorting VIX products. I personally will be staying away until June/July and then assess at that time whether the instruments have any merit...Cobra wrote:no idea. I never figured out VIX and its futures relationships, so I assume they're totally different things. and VIX doesn't work nowadays anyway.stepture wrote:Cobra,
Why does XIV increase so much? Does it mean something?
Thanks
I have seen options open on various contracts and the premiums were fairly high at first. Then more people rushed in and were willing to take more risk than they realized by crushing volatility. More algos are joining the fray. And they have seen this premium collection every Friday. An analogy would be that a guy working for $5 an hour has been joined by three people who made nothing and they will work for $1. It might be a fair explanation as to the VIX collapse as there is competition to sell premium.