VIX ETF Reverse Splits, Gathers $2.8 Billion in 2012

ETF Trends

The iPath S&P 500 VIX Short Term Futures ETN (VXX) conducted a 1-for-4 reverse split before Friday’s opening bell. The move resulted in a higher share price for the exchange traded note but with fewer shares outstanding.

VXX was trading hands at $33.79 a share in midday trading Friday, after closing the previous session at $8.65. [VIX ETF to Reverse Split]

On a split-adjusted basis, the ETN was down about 2%. The product is designed to reflect the performance of short-term futures contracts based on the CBOE Volatility Index, or VIX.

VXX is down about 75% year to date on a falling VIX and “contango” in the futures market, which causes the product to lose money on the so-called roll trade.

Yet the ETN has gathered net inflows of $2.8 billion year to date. It ranks eighth on the list of best-selling exchange traded products in 2012, according to Index Universe. [‘Bull Market in Fear’ — Investors Buy VIX ETFs Despite Price Decline]

VXX has a market capitalization of $1.6 billion, according to issuer Barclays.

Separately, several ProShares ETFs were trading Friday following share splits and reverse splits. [ProShares to Split ETFs]

iPath S&P 500 VIX Short Term Futures ETN

View photo

.

vix-etf

The opinions and forecasts expressed herein are solely those of John Spence, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

Rates

View Comments (0)