VIX Volatility Adventures: UVXY revisited

Discussion in 'Journals' started by KCalhoun, Apr 9, 2021.

  1. KCalhoun

    KCalhoun

    With the VIX under 20, I'm going to try yet again to bottomfish a UVXY reversal. I often get stopped out, but I'll try yet again, because the upside is good.

    thesis:
    + volatility always cycles up and down, so buy low, sell high makes sense
    + at $4.85/share, I think risk:reward is favorable here for UVXY
    + I bought small size here, will scale up once VIX > 20

    uvxy9apr1.jpg uvxy9apr2.jpg uvxy9apr3.jpg uvxy9apr4.jpg vix9apr.jpg
     
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  2. .sigma

    .sigma

    Good luck. Vol products are tricky tricky, yet oh so liquid.

    so you’re buying shares at $4.85? No optionality?
     
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  3. zghorner

    zghorner

    UVXY has F'd more people in the A than Elton John.
    The never-ending downtrend is obnoxious as hell...yes im holding calls lol.
     
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  4. KCalhoun

    KCalhoun

    true, it feels like a doomed ship.... but i cant forget buying tvix 52 selling 940... best $/share win in my life. i miss tvix like an ex girlfriend; i trade too much lol :p

    if it were a stock chart i'd skip it, but its volatility and therefore will go up someday... vix wont stay sub 20 forever

    also likely they'll reverse split it again soon

    tvixsell940.jpg
     
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  5. Tradex

    Tradex

    Indeed. :thumbsup:
     
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  6. Axon

    Axon

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  7. While I had a short term reversion signal on VXX on Thursday, don’t periods of low volatility in equity indexes tend to be long, as in years, sometimes?
     
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  8. KCalhoun

    KCalhoun

    Yeah good point about that, if you look at the 3-year chart for vix you can see it was under 20 for an extended amount of time.
     
  9. KCalhoun

    KCalhoun

    Lessons learned trading UVXY:

    • Best for daytrading during selloff days, not good for swings longer than 3 days
    • Don't buy premkt gaps up, don't sell premkt gaps down
    • Buy the dip, sell the rip. Always scale in, and use trailing stops
    • Like VXX TVIX it is often a sleeper, grinding slowly down, then bam a big spike up.... I set buy-stop orders to automate entries
    • Often has a run eod 3:30-4
    • When it runs up early by 11, tighten trailing stops, bc it usually drops later
     
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  10. comagnum

    comagnum

    Looking at shorting via UVXY provided there is some validation the SPY appears to be turning. Red flags: herd is all in & leveraged to the teeth.

    The easier short appears to be on the RTY/IWM since it's below resistance & well below it's highs. The R:R on the UVXY has gotten my full attention.

    upload_2021-4-11_12-49-1.png
     
    Last edited: Apr 11, 2021
    #10     Apr 11, 2021
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