Friday, 5 August 2016

TVIX, UVXY - six weeks of horror

With equities breaking new highs, and the VIX cooling to the low 11s, the 2x lev' bullish VIX instruments of TVIX and UVXY decayed for a sixth consecutive week, with net weekly declines of -12.6% and -13.1% respectively. Near term outlook offers further decay, as the US equity market looks strong into September.

TVIX, daily

UVXY, daily


*first, an update on the VIX, which saw a net weekly decline of -4.0%

Suffice to add... with equities strong, and the VIX crushed, the leveraged VIX instruments are continuing to decay.

The VIX-long trade looks dead (at least) into September.

*it is very surprising that TVIX - run by Credit Suisse, has not yet seen a reverse split, as UVXY recently did. Considering TVIX is now trading around $1, a 1 for 10 reverse split looks due to be announced.

UPDATE, Aug'7th.

As of the open of Aug'9th, TVIX will see a 1 for 25 reverse split.

Thanks to poster sutluc for the heads up.