What a day!
First off let me try to help all out by saying this was an inevitable move down to collapse a premium that TVIX was trading at (100% as of yesterday).
This is a normal thing to happen when the premium is too high as was the case with TVIX.
Please do not buy into or pay any attention to posters claiming it is going to ZERO, that is unlikely. I believe that bashers were saying this about UVXY recently, and it didn't.
If you have any doubts call Velocity Shares yourself, I did this morning when the take down was underway. Why they choose today to do this is anyone's guess, but IMO they had to under SEC rules as the fund was trading at 100% premium to it's NAV.
Funny how we trade the "fear" index and it induces "fear", no it really isn't funny,
I for one own TVIX at a much higher price than it is now.
In my opinion only, the market is beginning what could be a steep sell off, and volatility (VIX) will rise quickly. Perhaps another reason why today was chosen to back down TVIX, as that is becoming apparent.
Remember it wasn't that long ago that TVIX was right in line with it's NAV and it traded at 2x VIX which as we all know was quite higher than here....approximately $100 :)
Facts: This wasn't a weak hand shake out, or manipulation, or whatever conspiracy theory you see fit to describe. This is simple math and putting it in it's proper context.
Hang in there and GL to all playing upside volatility...we're due for a nice run.
You must be a simple TVIX idiot. You knew this had to go down like this yet you own it higher. Makes perfect sense. Now you are counting on a market collapse just to bail you out. LOL. Get your next 20% burr haircut tomorrow.
You have, absolutely, no clue regarding this product. Any ETP that spends >50% of its time in contango must go to zero. I know this product better than anyone and this is simply a trading vehicle not one you can buy and hold.
As to your phone call To VS, what on this earth do you think they're going to say. You are simply naive.
Thanks for the great analysis. However, in midst of all this is the fact about NAV.
How is that calculated for fund like TVIX? Does the NAV change everyday? Was the NAV same ($7.63) since last 6 months?
The NAV (Net Asset Value) is very complicated on how it's calculated.
The NAV was not 7.83 for last 6 months, in fact it was around 16.5 a couple of weeks ago and TVIX was 17.5 a very small premium.
But the VIX index was also much higher it hit 21.00 recently in the 1 day sell off that saw the DOW down 202 in one day.
The shorts had their way with this and they are almost all covered, unless they are completely stupid as it is so close to being aligned.
All you really need to do now is watch the VIX
GL to u too I hope they dont run this into the ground palying with the issuance. Most of us have no choice but to hodl and see. Maybe in a few days it will return to normal and bounce on volatility...what do u think of a shrt squeeze in the works also?
There has been several short squeeze rumors floating around for the past 2 weeks.
Most shorts covered today as there were NO AVAILABLE shares to short for the past 3 days...suspended short selling.
That was the tip of the hand that led me to believe it would be any day now that this occurred.
AH - TVIX traded down to 9.00 that is basically only a little over it's NAV of 7.83....in other words, mission accomplished.
I expect another !.00 drop tomorrow, but if VIX rises then so does the NAV. Almost looked like today the market maker was trying to have the 2 meet up, but the VIX took a dive so no chance.
However the worst of it is over, and as long as volatility rises so will TVIX.