Volatility Views Volatility Views 296: The Pending Trade War and Volatility
Mar 5, 2018
01:01:16
Volatility Review: A look back on the week from a volatility perspective
- A weird day in the markets, started with a massive selloff then ended unchanged.
- VIX cash - 22.5
- VIX futures - super backward again
- VIX options: ADV - 1.05M, VIX call/put: 2.1 - Total 12.0m (8.15m Calls, 3.87m Puts)
- Goldman says options-market activity suggests pain ahead in these sectors
- Nearly half of 2017's Cryptocurrency 'ICO' Projects Have Already Died
Volatility Voicemail: Options question of the week
There's much debate about SVXY these days. Will it survive 2018? Is it poised for serious upside? We'll table those questions for now and instead ask all of you out there slinging SVXY. What is your weapon of choice?
- 63% - Naked Long SVXY
- 20% - Long SVXY Calls/Spreads
- 10% - Long SVXY Puts/Spreads
- 8% - Long SVXY w/ Put Hedge
Listener questions and comments:
- Comment from Boris Ilyevsky - Maybe their FCM partners didn't give them a choice. SVXY UVXY
- Question from J3dingle - Hi Mark, Given that both RexxShares and ProShares have re-jiggered their Volatility ETPs, what are the odds that VXX does too? Thanks, Joseph
- Question from Tills - Any chance the recent changeup with SVXY is just to appease regulators. Maybe it will switch back later in the year?
- Comment from Volatility Analytics - SPX 37% of days this year have had a 1% change in SPX. Last year we had 8 total days.
- Comment from Ragin1234 - (RE: SVXY) XIV SVXY uneducated customers are to blame for not doing their due diligence.
- Comment from LLLC1 - I think the world just woke up to a new risk for vol products - "issuer panic risk". We all knew it was in the prospectus but now we've seen it materialize. I wonder how this will affect risk premiums in these products going forward.
- Comment from John Schryber - Those stocks got sold to cover the inverse leveraged trade. It's all connected. Passive funds are...passive.
Crystal Ball: Wild and reckless prognostication
Last week:
- Mark L. - 16.75
- Bill - 14
- Mark S - 15
This week:
- Mark L. - 17.75
- Mark S. - 28