VIX, VXX rise as volatility returns to Wall Street.
The CBOE VIX (NYSEARCA:VXX) rose on Wednesday, as equity markets struggled to regain momentum amid plunging oil prices and mixed corporate earnings.
The Chicago Board Options Exchange (CBOE) Volatility Index rose 3.5% to 14.93, on a scale of 1-100 where 20 generally represents the historical average.
The VXX, a directional play on volatility, has seen higher momentum over the past two weeks. Measures of relative strength show the potential of continued upside in the short term.
The large-cap S&P 500 Index (NYSEACA:SPY) finished 0.2% lower.
Major VIX ETFs:
iPath S&P 500 VIX Short Term Futures ETN: (NYSEARCA:VXX) Designed to offer exposure to the S&P 500 VIX Short Term Futures Index Total Return. The Index uses CBOE Volatility Index futures by way of a long position in the first and second month VIX Futures contracts. VXX advanced 2.3%.
VelocityShares Daily Inverse VIX Short Term Futures ETN: (NYSEARCA:XIV) Designed to track the inverse daily performance of the S&P 500 VIX Short Term Futures Index. XIV declined 2.4%.
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 advanced 4.7%.
VelocityShares Daily Short Term VIX 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 advanced 5.1%.
The Final Word: The markets have expressed a higher tendency for volatility this month. The VIX continues to trade below the historical average, but is quickly catching up, a sign mean reversion was back in play.