Can UVXY/TVIX "malfunction" like XIV and SVXY?

Discussion in 'ETFs' started by Saltynuts, Feb 6, 2018.

  1. Term


    Mav or anyone else out there - have y'all heard anything from Jane street or other prop firms? I've heard of a few blow ups so far.. No firm ending events, but some big set backs..
    #31     Feb 6, 2018
  2. SVXY is still trading right?
    #32     Feb 6, 2018
  3. Saltynuts


    stepandfechit, thanks. I think, if they just dissolve it willy-nilly, they can't just wipe everyone out - they would have to pay NAV. I could be wrong though (but I'm sure lawsuits are always in the cards lol).
    #33     Feb 6, 2018
  4. Saltynuts


    Dunno, but do you mean professional firms that were long XIV/SVXY and got caught up? They should know better hahaha.
    #34     Feb 6, 2018
  5. Saltynuts


    Yep, I had some shorted, made out on a bandit on these. Waaaaaay down, but they are still trading.
    #35     Feb 6, 2018
  6. Saltynuts


    Maverick and others - I answered one of my stupid questions earlier - what the VIX short-term futures index was - its the VIX lolol. But that still doesn't answer my underlying question - how UVXY/TVIX can be down 30% and XIV and SVXY down ~85% when they are supposed to hold opposite positions in futures. I think it was an after-hours blow-up that for some reason disproportionately affected XIV and SVXY, but that is all I can figure.
    #36     Feb 6, 2018
  7. Good for you
    #37     Feb 6, 2018
  8. Can someone explain how shorting vix future is different from inversed vix etf? Lets say vix future keeps dropping back to around 12 then the short future holder would not lose any money, but the svxy holder would be far from gaining what have been lost. Look like the magic is about the -1x definition of the etf.
    #38     Feb 6, 2018
  9. Maverick74


    The better way to think about is this, when you are in the inverse ETF you are locking in losses everyday. There is no concept of "just holding it". Every day you lock in losses as they buy back at the highs and sell down in the next month. The only thing that is locked is the duration.

    THIS is something most people don't understand. If you want to capture the selloff, you really need to just sell Feb and hold it into expiration. That way you can "ride it back down". The ETF does not do that, it holds and replicates a constant maturity. Do you understand that?
    #39     Feb 6, 2018
    beerntrading likes this.
  10. S2007S


    I wish they could invent an investment vehicle that literally trades exactly exactly exactly to what the vix does....not having any futures or erosion or backwardation involved with it.....why is this so hard to achieve.... they invent all these other worthless ETFs but can't develop one to trade the vix the way vix actually trades....

    I tried shorting VXX this morning premarket at $60 in two different accounts and I couldn' was free money but why I couldn't short ticked me I'll just wait until the vix drops back to single digits and VXX under $20 before going long volatility....there will probably be no more volatility ETFs after this fall out....SVXY will still exist but I think eventually they will shut it down because of the risk!!
    #40     Feb 6, 2018