Volatility is the Stock Pick (VXX)
The trade this week was not Apple Inc (NASDAQ:AAPL) hitting $500. It's been the iPath S&P 500 VIX Short-Term Futures ETN (NYSE:VXX) and yesterday the fund finished up 5.6%.
(WallStNation.com) Since Wednesday of last week (Feb 6th) the VXX has jumped 16%. Last summer we witnessed the VXX increase 109% in 30 days while the Dow Jones has plunged 13.6%. The Volatility Index (VIX), also known as the "Fear Index" has increased 11% in the past 4 trading sessions and hit 21.70 today. In 2012 the VIX has spiked 10% in four trading sessions only twice.
The "VIX" or Volatility Index is based on data collected by the Chicago Board Options Exchange. Each day, the CBOE calculates a number based on prices paid for puts and calls for the S&P 500. This number gives traders an idea of the implied volatility in the market for 30 days.
A direct investment in VIX (commonly referred to as spot VIX) is not possible. The S&P 500 VIX Short-Term Futures ETN (NYSE:VXX) holds VIX futures contracts, which could involve roll costs and exhibit different risk and return characteristics.
Bottom line: Traders are looking to the VXX thanks to the uncertainty with Greece 's debt and everything else under the sun. This 17% jump since last week could be a new trend if the headlines do not improve.
Best of the Blogs
Scanning and identifying the best blog entries every hour
- Australia Stunned After ISIS Plan To "Publicly Behead Random Person In Sydney" Foiled | ZeroHedge
- This Pension Fund Is Daytrading Your Retirement Funds, With Up To 500% Leverage | ZeroHedge
- Fast Underwater | iBankCoin.com
- Yesterday's Late-Day Buying Panic In Stocks Was The Biggest In 3 Years | ZeroHedge
- STTG Market Recap September 18, 2014 | FundMyMutualFund
- Gold - Watch the €1000 Level | Financial Sense
- The Good and the Bad Before BABA | iBankCoin.com
The most relevant financial news and articles from the Internets
- Sovereign Scotland Would Hurt Its Economy, but England Shouldn't Care | TheStreet.com
- DOW, S&P 500 HIT NEW ALL-TIME HIGHS: Here's What You Need To Know (DIA, SPY, QQQ, TLT... | Business Insider
- France Has Begun Bombing ISIS In Iraq | Business Insider
- 11 Quotes That Illustrate The Strange, Relentless Genius Of Alibaba Founder Jack Ma | Business Insider
- Asian Games to open 'Gangnam Style' | Business Insider
- The Sad Home Of A Sad Campaign To Keep The UK Together | Business Insider
- See The BBC's Pathetic Confession About Why Its Scottish... | Business Insider