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VIX Short Term Futures (VXX) falls with CBOE Volatility Index on Potential Washington Deal

By  +Follow October 11, 2013 8:11AM
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ETFs tracking the Chicago Board Options Exchange SPX Volatility Index (VIX) have been among the most-actively traded over the past two weeks as well as some of the biggest movers. The VIX, which attempts to reveal market sentiment by tracking options trading in order to forecast the level of volatility over the next month based on that activity, has been on the rise lately as concern about the government shut down and debt ceiling negotiations had investors anticipating higher volatility. However, recent signs that the stalemate might be nearing conclusion, or at least that Republicans may be willing to pass a short-term increase in the debt ceiling, has the VIX declining and the ETFs tracking it moving accordingly.

The VIX fell over nearly 5 percent on Friday, prompting the iPath S&P 500 VIX Short Term Futures (VXX) to drop almost 2 percent and the VelocityShares Daily Inverse VIX Short Term ETN (XIV) to gain nearly 2.25 percent.

More Promising News From Washington

The most recent move in the VIX and its corresponding ETFs appears to be related to news that a meeting between congressional leaders and President Obama went positively. Sources are indicating that congress will vote on a 6-week increase in the debt ceiling as soon as Friday, significantly cooling market fears.

Other ETFs tracking projected volatility were on the move as well, with the ProShares Trust II ($UVXY) and the VelocityShares Daily 2x VIX Short Term ETN (TVIX) both declining close to 5 percent.

VIX, ETFs Go on Wild Ride

The VIX is often referred to as the “fear index,” as it’s commonly viewed as a measurement of investors’ concerns about the markets. And the government shut down had investors appearing afraid, based on their options trades. The index shot up over 30 percent from October 1 to October 8, prompting the iPath VIX Short Term fund to gain just over 15 percent over the same period. Then, beginning with news that Boehner might be willing to pass a short-term debt ceiling increase, the VIX dropped nearly 20 percent to where it is today with the iShares fund declining over 15 percent during the same period.

On the whole, both the iShares fund and the VIX have declined over the last three days to return to levels close to where they were at the beginning of the month prior to concerns of political stalemate driving market worries.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


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Results for VXX
Tom Loffman
18 Dec 14 19:01:31
$VIX.X $VXX $XIV commentary. Recent days volatility spike into strong buy zone. Sharp drop in vol is very bullish. Expect rally to continue.
池部良
18 Dec 14 18:26:05
RT @VixCentral: $VIX futures contango settled at 2.33% It is not expensive to hold $VXX and $UVXY long term.
IH News Desk
18 Dec 14 18:08:12
$XIV Percent Change Updated Thursday, December 18, 2014 8:11:43 PM $AMD $SM $DIA $VXX http://t.co/02EbGYOLU3
Langan Stocks
18 Dec 14 17:53:17
$VXX Last Price Updated Thursday, December 18, 2014 8:03:30 PM $ALXN $VIPS $DIA $DRYS http://t.co/egD0k41Pjw
PolgarStocks
18 Dec 14 17:53:09
$SBUX Stock Price Updated Thursday, December 18, 2014 8:07:37 PM $AAPL $VTI $SGLB $VXX http://t.co/PsnU6ZyjpA
IH News Desk
18 Dec 14 17:07:14
$CRUS Last Price Updated Thursday, December 18, 2014 7:11:44 PM $VXX $DBC $ORCL $XLB http://t.co/EHjsYm5sWs
BOSTRADER
18 Dec 14 16:51:32
$VXX Buying more Puts tomorrow. $SPY $SPX $VIX http://t.co/2LS3jfkpNA
Carolyn B Miciano
18 Dec 14 15:21:49
Maximize profits with Fibonacci http://t.co/QZ4hT6YDQs $VIX $VXX $OEX
Bill Tsamis
18 Dec 14 15:12:19
@MktOutperform why do you think $VXX held up so well today?
Sparrtweets
18 Dec 14 15:10:57
Oh, there's what happened. $VXX breaks 50. There were a lot of crazy up and down moves before this close. $VIX $SPX http://t.co/D8baNW56N0
Carolyn B Miciano
18 Dec 14 15:08:51
Bull calls are an extension of the Long Call http://t.co/p9KeWdiLwS $VIX $VXX $OEX
Annie
18 Dec 14 14:54:27
Nikkei up, $SPY up but Yen largely unchanged today. If not carry trade, doesn't make you wonder why all global money moving here? $FXY $VXX
'ga re Tshwane'
18 Dec 14 14:37:30
RT @HFTAlert: Dark Pools heavy sellers of $spy today. $VXX MP rising tells us they're buying protection. http://t.co/SY2woGBCKO
bizrockstar
18 Dec 14 14:20:27
RT @HFTAlert: Dark Pools heavy sellers of $spy today. $VXX MP rising tells us they're buying protection. http://t.co/SY2woGBCKO
Robin Feenstra
18 Dec 14 13:52:15
@iskounta I build up puts in de $VXX last days. Disappointing day today. Small decline.
Robin Feenstra
18 Dec 14 13:43:32
RT @JLoesser: @vikasrao most interesting thing of the day. $vix down 9% still and $vxx almost flat...very odd. One more gap up for premium …
Robin Feenstra
18 Dec 14 13:43:04
RT @2sharghate: Major disconnect here $svxy $uvxy $spy $vix $vxx
Annie
18 Dec 14 13:41:10
Holding bit of $VXX overnight... somebody spiked the eggnog today on the rest of the market and may be hungover tomorrow
Eli Mintz
18 Dec 14 13:27:44
$VIX futures contango settled at 2.33% It is not expensive to hold $VXX and $UVXY long term.
Derek
18 Dec 14 13:25:55
$VXX
Jared LeClaire
18 Dec 14 13:11:44
I really missed the opportunity to short $VXX over these last two days. Down about 14% from yesterday's highs. Gotta be better. $VIX $SPY
Carolyn B Miciano
18 Dec 14 13:03:38
Create weekly income legs from straddles http://t.co/i8Sj1jvWs6 $VIX $VXX $OEX
Mah Bizzle
18 Dec 14 13:00:22
@Fullcarry looks like $VXX
Becky Hiu
18 Dec 14 12:44:33
"@TopstepTrader: $VXX is holding up well consider $SPY is up a million points."
Vahid
18 Dec 14 12:32:01
$VXX is not as weak as it should be in an up day like today. This is not all clear santa rally.
i_like_bb_stock
18 Dec 14 12:23:29
$VXX sure isnt down much given the $SPY move
1 TRADER
18 Dec 14 12:19:00
You think $VXX volatility would go down with $SPY recovering. Not. #tradewhatusee
Tushar Ghate
18 Dec 14 12:15:18
Major disconnect here $svxy $uvxy $spy $vix $vxx
Jeff C Brook
18 Dec 14 12:03:13
@harmongreg @StockTwits @RiskandVolatility pretty soon we'll see the farce +2% and green $VXX
Richard Gobel
18 Dec 14 11:57:14
$VXX going green? something just does not feel right today with this rally http://t.co/c8FiWGq73W via Scutify
MJR
18 Dec 14 11:56:41
$VX_F $VXX The $VIX volatility chart is forming possible handle portion,of a 2 month wide bullish "cup and handle"on its daily candle chart
selling_theta
18 Dec 14 11:49:53
spot $VIX still over JAN future has bothered $VXX all day.
Johnny Trades
18 Dec 14 11:42:53
$VXX Needs to clear 31-31.44 looks like good R
Jeff Loesser
18 Dec 14 11:42:12
@vikasrao most interesting thing of the day. $vix down 9% still and $vxx almost flat...very odd. One more gap up for premium to drain
Becky Hiu
18 Dec 14 11:28:45
$CL_F pressings LOD here. So, does it even matter? $VXX says yes it does cause it's only down 1.1% when the $SPY is up 1.7%.
Alysia Sarkisian
18 Dec 14 11:22:21
RT @SeekingAlpha: The Mistakes Smaller Investors Are Making http://t.co/cayTRr0MMl $TVIX $XIV $VXX
Josh
18 Dec 14 11:21:34
#CrudeOil continues to slide, I see that as a leading indicator for $SPY weakness coming. Back in some $VXX here. Fed announcement = fluff
Stickggs
18 Dec 14 11:20:03
RT @SeekingAlpha: The Mistakes Smaller Investors Are Making http://t.co/cayTRr0MMl $TVIX $XIV $VXX
Seeking Alpha
18 Dec 14 11:15:48
The Mistakes Smaller Investors Are Making http://t.co/cayTRr0MMl $TVIX $XIV $VXX
Johnny
18 Dec 14 11:15:06
Is $VXX staying strong becuase $SPY is goin down? put buyer
Zero Filter
18 Dec 14 11:05:48
@steveliesman #CNBC Surprisingly cautious big moves up market post yet another #Fed #juiced rally $SPY $VXX
David Webb
18 Dec 14 10:50:27
Not much to say. Coasting on $vxx shorts til end of week. Pretty early to start loading negative delta. $spy $IWM
Robin of the Hood
18 Dec 14 10:42:53
@JLoesser $VXX is so strong!!!
TV_Trading Ideas
18 Dec 14 10:34:42
$SPY $VXX $SDS Yesterday said that bears must be patience! $IWM http://t.co/FiWEDXXZz0
Iskounta
18 Dec 14 10:34:42
$IWM chart: $SPY $VXX $SDS Yesterday said that bears must be patience!. http://t.co/nZS2sBvWkG
Johnny
18 Dec 14 10:30:36
$VXX should be down a lot more
Jeff C Brook
18 Dec 14 10:24:00
$NQ, $NDX % gains ready to outpace $VXX intraday % losses.
Common Man Investor
18 Dec 14 10:18:09
$VXX still being held back by price of Crude while the $VIX isn't. Interesting at least...
1 TRADER
18 Dec 14 10:15:09
There was a $VXX volatility spike Jan-Feb this year. I'm preparing for a repeat in 2015, possibly earlier.
ur-trading
18 Dec 14 10:12:30
$VXX http://t.co/gTgmzWVLEY
				
				
By  +Follow October 11, 2013 8:11AM
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