CBOE VIX Volatility Index retreats as stocks inch closer to record highs.
The CBOE VIX (NYSEARCA:VXX) declined on Friday, as stocks resumed their upward momentum after better-than-expected jobs data boosted investors’ morale.
The Chicago Board Options Exchange (CBOE) Volatility Index bottomed at 12.17 on a scale of 1-100 where 20-25 is considered normal. VIX would later settle at 12.84, having declined 5.5%.
In stocks, the S&P 500 Index (NYSEARCA:SPY) gained 0.5%.
ProShares Short VIX Short-Term Futures (SVXY) to track the inverse daily performance of the S&P 500 VIX Short Term Futures Index. SVXY advanced 1.1%.
ProShares Ultra Short Term VIX Futures: (NYSEARCA:UVXY) UVXY is designed to deliver 2X (leveraged) returns of the day’s moves in the S&P 500 VIX Short Term Futures Index. It tacks the two front months of the futures contract. UVXY declined 3.2%.
VelocityShares Daily 2x VIX Short Term Futures ETN (NYSEARCA:TVIX) TVIX is a leveraged VIX ETN designed to deliver 2X the returns of the daily S&P 500 Short Term Futures Index. TVIX declined 3.6%.
The Final Word: Volatility’s retreat is aligning with a long-held seasonal trend: Sell in May and Walk Away. Beginning next month, traders will begin closing out their positions ahead of the summer holidays. This period is considered less volatile from a historical perspective.