ETF Database » VXZ

Volatility ETPs: Where Are The Critics Now?

Eric Dutram — Mon, 03 Oct 2011 11:00:13 +0000

This article was written by Paul Weisbruch, the VP of ETF/Options Sales and Trading at Street One Financial. An interesting dynamic shift has occurred in the VIX (CBOE Volatility Index) since the early August equity market meltdown, where the VIX futures curve itself moved from a prolonged period of contango to backwardation. For years, Volatility/VIX related ETFs and ETNs were much maligned in the media and by advisory and institutional firms alike as far as their ability or lack of to track spot VIX themselves. However, if an investor carefully reads the product prospectuses they will note that none of the VIX related ETF/ETN products on the market currently are designed to track spot VIX. This said, utilizing the products effectively as plays on volatility as well as volatility hedges requires not only a comprehensive understanding of how each individual fund is designed, but also a thorough scope of the [...]

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Volatility ETFs: The Real Safe Haven?

Jared Cummans — Tue, 09 Aug 2011 13:45:42 +0000

Friday saw the unthinkable happen; a downgrade of U.S. debt by Standard and Poor’s, who then went on to downgrade Fannie Mae and Freddie Mac, shattering markets in the process. But now that the decision is in, and there is no looking back, many have fought over whether or not S&P made the right move, especially given the fact that Moody’s and Fitch upheld our AAA rating [see also ETFs To Watch As Debt Ceiling Deadline Nears]. On one of the spectrum, the Obama administration seemed appalled, calling the downgrade a politically motivated action that didn’t take all the facts into consideration. Their major sticking point comes from an extra $2 trillion oversight in projections that S&P later owned up to as a mistake, but still upheld their AA+ rating. Now major businessmen and investors are joining in the battle as Donald Trump publicly criticized S&P, while Warren Buffet said [...]

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Examining VIX ETF Performance During A Sell-Off

Michael Johnston — Mon, 21 Mar 2011 11:00:17 +0000

Innovation not only in the ETF space but throughout the financial industry has opened up new opportunities in recent years, allowing investors to access asset classes and strategies that had previously been out of reach. One example of such a phenomenon is the volatility space, which has been transformed from a hypothetical but widely-followed measure of investor sentiment to an investable asset. The VIX, which measures the implied volatility of U.S. equity markets over the next 30 days and is computed using inputs from S&P 500 options, has been around for more than two decades, but by the vary nature of its calculation is not an investable asset [see How ETFs Have Democratized Investing]. Thanks to the introduction of options and futures linked to the VIX over the last several years, this measure of volatility has been transformed into (essentially) an investable asset class. And the more recent development of [...]

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Best ETF Performers Of 2010: Winners For Every ETFdb Category

Michael Johnston — Wed, 05 Jan 2011 12:00:23 +0000

Last year was a good year for most asset classes, as investor portfolios continued to recover from the recent recession. The difference in performance between many comparable funds was significant, and many of the best performers of 2010 are relatively small funds that maintain considerably smaller asset bases than their more popular competitors. Below, we profiled the top performing ETFs in more than 60 ETFdb Categories covering all major asset classes. ETFs that launched in 2010 were excluded, as were those that stopped trading during the year [for more ETF insights, sign up for our free ETF newsletter]: Equity ETFs Many equity ETFs turned impressive performances in 2010; below, we profile the best of the best: All Cap Equities: The First Trust Multi CG AlphaDex (FAD) added 25.2% last year, besting the more popular VTI (up 17.4%) and IWV (up 16.8%) by a wide margin. Large Cap Blend Equities: The [...]

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Ten Worst Performing ETFs Of 2010

Michael Johnston — Tue, 28 Dec 2010 12:00:54 +0000

In general, 2010 has been a pretty solid year for most portfolios. Despite lingering concerns about unemployment and mounting debt burdens, most global equity markets have moved higher on the year. Commodity markets have been red hot, with prices of many natural resources climbing to new highs thanks to strong demand from emerging markets and a shaky dollar. And while bonds have shown exceptional volatility during the last 12 months, many fixed income securities have managed to deliver at least modest gains as well. But there have, of course, been some disappointments this year as well. Below, we offer up some potential inspiration for contrarian investors: a list of ten of the worst performing ETFs of 2010. Performance data is as of December 21, and this list excludes all leveraged and inverse funds, as well as any ETFs that began trading during the year: 10. iPath EUR/USD Exchange Rate ETN [...]

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Reviewing All The VIX ETF Options

Michael Johnston — Fri, 10 Dec 2010 15:00:53 +0000

The impressive ETF boom that has unfolded over the last several years has been the result of a number of attractive features of the exchange-traded structure relative to traditional mutual funds. In addition to considerably lower expenses, intraday liquidity and enticing tax breaks have fueled interest in ETPs, which now number nearly 1,100 in the U.S. and hold close to $1 trillion in assets. As ETFs have become more targeted and specialized, they have allowed all types of investors to gain exposure to securities and strategies that were previously hard-to-reach. ETFs such as the Market Vectors China ETF (PEK) offer exposure to unique assets like China’s A-shares market, a new opportunity for U.S. investors [see Closer Look At The China A-Shares ETF (PEK)]. ETFs have also been instrumental in making commodities a widely available asset class, making it possible for all types of investors to access both futures-based and physically [...]

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New Firm Plans Inverse, Leveraged VIX ETNs

Michael Johnston — Wed, 24 Nov 2010 12:00:22 +0000

VelocityShares, a newcomer to the ETF industry, is planning to jump into the world of volatility exchange-traded notes, recently detailing six new ETNs designed primarily for short-term sophisticated investors. The notes, which will be issued by Credit Suisse, will include 1x, -1x, and 2x versions linked to both the S&P 500 VIX Short-Term Futures Index and S&P 500 VIX Mid-Term Futures Index: ETN Index Leverage Ticker Inverse VIX Short Term ETN S&P 500 VIX Short-Term Futures Index -100% XIV Long VIX Short Term ETN S&P 500 VIX Short-Term Futures Index 100% VIIX 2x Long VIX Short Term ETN S&P 500 VIX Short-Term Futures Index 200% TVIX Inverse VIX Medium Term ETN S&P 500 VIX Mid-Term Futures Index -100% ZIV Long VIX Medium Term ETN S&P 500 VIX Mid-Term Futures Index 100% VIIZ 2x Long VIX Medium Term ETN S&P 500 VIX Mid-Term Futures Index 200% TVIZ VIX 101 The CBOE [...]

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ETF Pipeline Grows: More Hedge Fund Products, VIX ETNs In The Works

Michael Johnston — Fri, 05 Nov 2010 11:00:48 +0000

Less than a week into November, the month is shaping up to be one of the most active in recent memory for the ETF industry. Vanguard (international real estate ETF), UBS (another MLP ETN), PIMCO (laddered Treasury fund), and Global X (Gold Explorers) have already launched new ETFs, and several more issuers are expected to debut new products in coming weeks. And as new funds hit the market, the product pipeline is quickly refilled with ideas for new products. One of the more interesting filings to hit the SEC’s desk this week came from ProShares, which detailed plans for its Hedge Fund Replication ETF. The proposed fund would track the performance of the Merrill Lynch Factor Model – Exchange Series. That benchmark is designed to maintain a high correlation with hedge fund beta, as represented by the HFRI Fund Weighted Composite Index, an equally-weighted composite of more than 2,000 constituent [...]

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Using ETFs As “Portfolio Insurance”

Michael Johnston — Tue, 05 Oct 2010 15:00:59 +0000

Although there are now nearly 1,100 exchange-traded products available to U.S. investors, the universe of ETFs utilized by most long-term buy-and-holders is considerably smaller. Beyond the “plain vanilla” portfolio building block ETFs, recent years have seen the introduction of hundreds of more targeted and complex ETPs that offer exposure to exotic asset classes and regions of the world. Many of these more specialized exchange-traded products aren’t of much interest to those in it for the long haul; they are more appropriate for more active traders looking to capitalize on short-term pricing inefficiencies or implement a sophisticated investment strategy. But some of the ETFs that investors may be inclined to brush off as tools for traders may actually make a lot of sense as a minor allocation in some long-term portfolios. Below, we profile three ETFs that may be effective as “portfolio insurance” against a prolonged downturn in stock markets. These [...]

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Barclays Rolls Out Inverse VIX ETN (XXV)

Michael Johnston — Tue, 20 Jul 2010 14:42:22 +0000

Barclays Capital announced the latest addition to its ETN product lineup this week, launching the first exchange-traded product designed to offer inverse exposure to the primary measure of equity market volatility. The Barclays ETN+ Inverse S&P 500 VIX Short-Term Futures ETN (XXV) is linked to the inverse performance of the S&P 500 VIX Short-Term Futures Index Excess Return, a benchmark that reflects the returns potentially available through an unleveraged investment in short-term futures on the VIX index. The CBOE Volatility Index, better known as the VIX and often referred to as the “fear index,” is a popular measure of the implied volatility of S&P 500 index options. The VIX represents the market’s expectation of volatility over the next 30 days. The VIX was introduced in 1993, but options for achieving exposure to the benchmark are relatively new innovations. Trading in VIX futures began in March 2004, and options were introduced [...]

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ETF Database » VXZ

Volatility ETPs: Where Are The Critics Now?

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Volatility ETFs: The Real Safe Haven?

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Examining VIX ETF Performance During A Sell-Off

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Best ETF Performers Of 2010: Winners For Every ETFdb Category

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Ten Worst Performing ETFs Of 2010

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Reviewing All The VIX ETF Options

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New Firm Plans Inverse, Leveraged VIX ETNs

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ETF Pipeline Grows: More Hedge Fund Products, VIX ETNs In The Works

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Using ETFs As “Portfolio Insurance”

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Barclays Rolls Out Inverse VIX ETN (XXV)

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