CBOE VIX Volatility Index rises sharply on Tuesday as stocks slide.
The CBOE VIX (NYSEARCA:VXX) gained significant ground on Tuesday, as rate-hike jitters triggered a sharp decline for U.S. stocks.
The Chicago Board Options Exchange (CBOE) Volatility Index reached a high of 14.69 on Tuesday. The so-called “fear index” settled at 14.63 for a gain of more than 13%. That was the highest settlement in a week.
In equities, the large-cap S&P 500 Index (NYSEARCA:SPY) declined 0.7% on Tuesday.
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 7%.
ProShares Short VIX Short-Term Futures (SVXY) to track the inverse daily performance of the S&P 500 VIX Short Term Futures Index. SVXY declined 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 advanced 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 advanced 12.5%.
The Final Word: Volatility has returned to Wall Street, a trend that is expected to continue in the latter half of 2018 as the Federal Reserve signals for higher interest rates.