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iPath S&P 500 VIX ST Futures ETN Message Board

emerging_mkts 10 posts  |  Last Activity: Jun 13, 2014 3:38 PM Member since: Oct 26, 2006
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  • emerging_mkts emerging_mkts Jun 13, 2014 3:38 PM Flag

    At the same time that front-month VIX futures are expiring, the second month is becoming the front-month. That causes a psychological re-pricing of that particular future.

    At this time also, VXX/SVXY/UVXY/XIV/TVIX etc. are nearly 100% invested in the second-month future (the mix needs to have an average maturity of 30 days). This is the one future that gets hit the most due to expiry of the front-month, and hence the big hit to VXX/TVIX/UVXY etc. or boost to SVXY/XIV etc.

    Makes sense ?

  • emerging_mkts emerging_mkts May 30, 2014 12:22 PM Flag

    I am not "conveniently" ignoring anything. I have always myself mentioned about the long-side ETF/ETNs.

    My counter is just to the wild claims of SVXY growing to infinity over time.

    Today, in fact, VXX and UVXY are helping increase the contango and helping depress the front-month VIX futures. I absolutely agree.

    I notice that VXX has grown in size from about 600M a couple of months ago (if I remember correctly) to over 1B now.

    But in order for VXX to balance out SVXY for all time to come (and SVXY growing exponentially all the time), VXX will also have to grow exponentially. Now you tell me : Is it possible for VXX to grow exponentially ? If not, then how can SVXY grow exponentially ?

  • emerging_mkts emerging_mkts May 29, 2014 6:14 PM Flag

    How did you forget to add : But the 10-year is NEVER going to see even 3% EVER AGAIN. If it reaches 2.9%, the Fed is going to immediately stop taper, and start increasing QE3 to $200B per month.

    Jokes apart, I think 5% on 10Y is not going to happen for at least 3 years. Unless and until the dirtiest ugliest old witch Janet Yellen is thrown out by a new president in 2017.

  • emerging_mkts emerging_mkts May 28, 2014 11:31 PM Flag

    Moreover, someone posted that SVXY would have been about 7.5 in 2011. That means, between 2004 to 2011, it grew from $5 to $7.5...

    What is the precentage growth ? Perhaps 6-7% per annum ? Again, that was the period when no ETF/ETN was trying to "milk" VIX contango. VIX futures were being used solely for portfolio hedging.

    Now VIX contango is being milked somewhat. As SVXY grows in size, this "milking" will be more and more pronounced. VXX will eventually fall behind, and SVXY will be its own self-moderating factor.

  • emerging_mkts emerging_mkts May 28, 2014 11:21 PM Flag

    Back in 2004, No ETF/ETN existed around VIX futures. VIX futures were being used only for hedging. .

    Just wait for another several years. Let SVXY total fund grow to a couple of billions. Report what percentage growth SVXY is showing per annum, say, in 2024

  • Reply to

    Contango question for all

    by ralphjlindblom May 24, 2014 1:16 PM
    emerging_mkts emerging_mkts May 27, 2014 8:18 PM Flag

    And lovers will always widen/expand their CUNTANGO !!!! YEAH !!!!

  • Reply to

    Contango question for all

    by ralphjlindblom May 24, 2014 1:16 PM
    emerging_mkts emerging_mkts May 27, 2014 4:03 PM Flag

    I meant sustained "high-VIX" vs sustained "low-VIX" environments.

    Of course, the most SVXY can gain in a day is 100% (if the VIX futures drop from some value to ZERO). That is a theoretical extreme, and perhaps has a nearly 0% probability..

    Similarly, the most SVXY can lose in a day is also 100% (if VIX futures double in a day because of a bad event). That is another theoretical extreme, although not as improbable as the previous one, especially if VIX is playing in the 8-10 range.

  • Reply to

    Contango question for all

    by ralphjlindblom May 24, 2014 1:16 PM
    emerging_mkts emerging_mkts May 27, 2014 3:10 PM Flag

    Who are the naysayers ? "Sustained low" VIX is what helps SVXY.. that is very clear.

    The probability of a VIX spike increases from a low-VIX, but that is another matter.

    Has anyone said that SVXY will rise faster in a high-VIX environment (than in a low-VIX environment) ?

  • Reply to

    Where were the EM and other clowns?

    by fedrally001 May 23, 2014 5:22 PM
    emerging_mkts emerging_mkts May 24, 2014 12:50 PM Flag

    emerging_mkts never said SVXY "WOULD" go to ZERO. He only said it "COULD" go to zero in one day if something REALLLLLLY bad happened and the VIX futures spiked up real hard. He still says that. it is a low probability event, but it could happen.

    More likely, it could lose a HUGE percentage (like 80-90%) in a few days if something bad happened.

    emerging_mkts is himself usually long SVXY (most often through calls). He likes to do call spreads, which were almost impossible all of last year. It was possible for a couple of months this year, but it is getting impossible again.

    LASTLY : The problem emerging_mkts has is with the sentiment that "Nothing can go wrong with SVXY, EVER" or that "$1K invested in SVXY will grow to $10B in 30 years".

  • Reply to

    fed, bob, e.m. ...

    by bustin_ur_chops May 21, 2014 7:38 PM
    emerging_mkts emerging_mkts May 22, 2014 1:57 PM Flag

    I am open to feedback. Please tell me which of my comment(s) about SVXY (not about bob or fed) are not well-though-out. I would like to improve my thinking and reasoning if I find some useful feedback from you.

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