With the kinds of experiences I've had in my life, I keep thinking they might pull this under the rug from us and not allow us to make money with it. At this point, I could handle an ETF or ETN with NO contango so all you'd have to do is wait for calm times to buy then sell during volatile times. Of course, buying UVXY didn't work for me. $733 of my money went to $20 in one year. So I'm kind of thinking of buying the dips on this. Even dollar cost averaging could possibly work with something like this. I don't eliminate the possibility that the fun times may end for this symbol though. Because there was an article somewhere they mentioned there's going to be a sort of "non-decaying" (if I understand correctly) VSTOXX index in Europe If that works out, I wonder if eventually it may appear in North America
The current returns from XIV are extremely nice, but... had you been able to buy this in February of 2007, you would have lost 90% of your investment by December of 2008. Now in fairness, 2008 was a pretty remarkable year (as in, remarkably volatile), but a VIX back up much closer to 20 could easily happen. I'm not saying it's headed back up in the very near term (sure wish I knew how to predict that!), but over time it's bound to happen. Turn off QE, and things would probably get ugly fast.