would you like to see double inverse short term VIX?

VOTE : double inverse short term VIX

  • YES

    Votes: 5 71.4%

  • NO

    Votes: 0 0.0%

  • Why Bother

    Votes: 1 14.3%

  • Too much risk for me

    Votes: 1 14.3%

  • I have an ethical dilemma to making easy money

    Votes: 0 0.0%
  • Total voters
    7
  • Poll closed .
maverick

Perhaps we have a failure to communicate but I am aware of the path dependency nature of leveraged products and daily re-balancing.

My journal will show the rewards or pitfalls thereof.

I understand your reasoning I just disagree with your conclusion.
 
Quote from PHOENIX TRADING:

maverick

Perhaps we have a failure to communicate but I am aware of the path dependency nature of leveraged products and daily re-balancing.

My journal will show the rewards or pitfalls thereof.

I understand your reasoning I just disagree with your conclusion.
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Fair enough. What exactly are you disagreeing with? I'm not making a call about whether one should be long vol or short vol. I'm simply saying these products as a whole don't work. It doesn't matter if they are long vol or short vol. They simply don't work and the math proves it. If there was a double short term inverse VIX I would short the f*cking hell out of it. Of course the shares become hard to borrow the day they begin live trading.

Maybe I didn't understand where you think the "easy" money is in this trade. I'm willing to listen. I know these products very well and the only easy money I see is shorting every single one of them regardless of whether they are long or short vol.
 
Quote from Maverick74:

Fair enough. What exactly are you disagreeing with? I'm not making a call about whether one should be long vol or short vol. I'm simply saying these products as a whole don't work. It doesn't matter if they are long vol or short vol. They simply don't work and the math proves it. If there was a double short term inverse VIX I would short the f*cking hell out of it. Of course the shares become hard to borrow the day they begin live trading.

Maybe I didn't understand where you think the "easy" money is in this trade. I'm willing to listen. I know these products very well and the only easy money I see is shorting every single one of them regardless of whether they are long or short vol.
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I see the value in a double inverse vix etf after a sharp spike in the vix as volatlity appears to be mean reverting.
 
Quote from PHOENIX TRADING:

I see the value in a double inverse vix etf after a sharp spike in the vix as volatlity appears to be mean reverting.
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OK, sure. But you can just trade XIV with twice the position size right? You can sell call spreads in VIX. You can sell call spreads in VXX. You can trade the VIX futures spread. Sell the front month future and buy the back month as the spread goes from backwardation into contango again.

I just don't see how the 2x is better then the 1x. The 1x will probably perform much better then the 2x.

There was a whole debate on ET awhile back that many of the ETF managers are not even doing what they say they are doing on the 2x and 3 x products. They sometimes are not long or short enough contracts and some are just outright speculating.

I really believe the 1x are the safest products and "seem" to perform relatively well. As I pointed out, XIV is underperforming by a wide margin and my guess is the ETF manager got a little creative.
 
Quote from Maverick74:

OK, sure. But you can just trade XIV with twice the position size right? You can sell call spreads in VIX. You can sell call spreads in VXX. You can trade the VIX futures spread. Sell the front month future and buy the back month as the spread goes from backwardation into contango again.

I just don't see how the 2x is better then the 1x. The 1x will probably perform much better then the 2x.

There was a whole debate on ET awhile back that many of the ETF managers are not even doing what they say they are doing on the 2x and 3 x products. They sometimes are not long or short enough contracts and some are just outright speculating.

I really believe the 1x are the safest products and "seem" to perform relatively well. As I pointed out, XIV is underperforming by a wide margin and my guess is the ETF manager got a little creative.
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could you post a link to those debates, sounds important
 
Quote from PHOENIX TRADING:

Oh you are talking about an etn not holding the actual underlying futures to simulate the strategy.
I thought that was common knowledge.
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Yeah, but they do hold the futures. That's the problem. That is where the negative roll yield is coming from. But some of these managers are varying the degree of their futures exposure that might not allow the ETF to accurately replicate the actual VIX product it's try to replicate. In other words, it's a clusterf*ck.
 
Quote from Maverick74:

Yeah, but they do hold the futures. That's the problem. That is where the negative roll yield is coming from. But some of these managers are varying the degree of their futures exposure that might not allow the ETF to accurately replicate the actual VIX product it's try to replicate. In other words, it's a clusterf*ck.
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I wish I knew how profunds does it's daily roll.
 
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