Investor Makes Mammoth VIX Bet That Could Pay Out $265 Million

Discussion in 'Wall St. News' started by Chuck Krug, Jul 25, 2017.

  1. Just as VIX is well on its way to hit a new all time closing low... If Oct VIX futures end up settling arnd where we are now, this trade will lose arnd $67mio.
    TraDaToR likes this.
  2. I wonder who it is.
  3. TraDaToR


    1/4 risk/reward... You find it too low?
  4. SteveM


    Heads I lose 1, tails I win 4 is a good trade as far as I am concerned.
  5. algofy


    I'm not sure it's a 50/50 proposition.
    JackRab and lawrence-lugar like this.
  6. This trade's risk isn't necessarily limited to the number I've given. Its reward, on the other hand, is capped at the max given in the OP's article.

    This is what the payoff looks like at expiry:
    vix monsta.jpg
  7. newwurldmn


    And you have to be crazy precise to earn that reward. When does the VIX hit 25 and vix vol (and vixset volatililty) remain low?
  8. Ye, given the sheer size of this thing, it's baffles me bigly...
  9. newwurldmn


    is it possible that the news services got the side wrong? the other side sounds a lot better as a tail hedge.
    #10     Jul 25, 2017