CBOE VIX Volatility Index declines sharply following election results.
The CBOE VIX (NYSEARCA:VXX) plunged below the historic average on Wednesday, as stocks staged a massive relief rally following the midterm election.
The Chicago Board Options Exchange (CBOE) Volatility Index, also known as the fear gauge, fell 16.4% to close at 16.64. That puts the VIX well below the historic average of 20.
VIX plunged thanks to a large upsurge in stock prices, with the S&P 500 Index (NYSEARCA:SPY) gaining 2.1%.
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 declined 7.3%.
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 3.6%.
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 10.6%.
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 14.2%.
The Final Word: Post-election euphoria suggests the bulls are regaining control of the market following a disastrous October. Moving forward, attention shifts to U.S.-China trade relations with the leaders of both countries scheduled to meet in Argentina later this month.