Can't say for sure... depends upon the "degree/conviction of fear" psychology at the time. However, a 20%-ish drop in the SPY in 2011 produced about a 200% rise in the the VXX.
my bad.. yes. i meant.. VXX... sorry . if SPY moves 5-6 %... wihch is like 193 to 180s.. then how much will VXX move... i doubt it will break 50 ..... also.. since VXX is now drifting to the 20s... then it will go to teens. .and then BARCLAYS will be the CLASSIC - WASH RINSE REPEAT.. ha ha.. REVERSE SPLIT it 1:5 and bring it back to 60s... and voila. .we have volatiliy and many more suckers roped in... AMAZING... this has been since last 2-3 years..
YES.. its the FEAR.. .and that is what we cant really measure... also the velocity. if SPY starts drifting slowly.. ha ha.. then there wont be much rise in VXX a SURE CERTAIN TRADE is... WAIT FOR a VXX SPIKE. .say 30%. and then buy long term PUTS... u just CANT GO WRONG>> ha ha... but I bet you . it will all be priced in....
Yep, 175% or so from swing low to high. Good point. SPY Price action in August/Sept 2011 was really nutty (albeit ultimately sideways), with VXX meanwhile having driven higher. Just took more than a few months to see the full move in VXX, though, due to that extended ugly mega chop-chop. If we did see a huge 20% drop quickly in SPY, perhaps the corresponding VXX move would be a quick 200%? Looks like 90-95 would be 'resistance' on VXX, looking long term. In that case, easy 100 baggers on the right call strikes, bought at the right time, with the right expiration. All you need is $0.46 per share (plus transaction costs) and a dream. Cheaper than lotto, on a per share basis, anyway.
No, the words 'sure' and 'certain' have little place in this business. Unless you are talking about buying the dips in a centrally planned market. Which it appears you are. Carry on, then.
Was waiting for a tag of 32.9x - 33.0x this week to consider going long VXX. Really hard to say if we'll get down there. Exit door might get crowded this week a bit early? Obvious top is obvious..
option writers like no volatility. their out of money call options and out of money put options expire worthless. 50% of the time the market is dead..put buyers are and c all buyers out of money are the fools in the market.
Well well well, Mr. Market gave us 32.9x after all. Low print thus far is 32.93. Willing to go long down to 32.5 or so for good measure. Looking for 1931 today/tomorrow as a ceiling on SPX cash index. Good Luck. You will need it, bears.