Today, May 3, 2016, two new volatility ETFs will start trading on the BATS electronic exchange - the REX VolMAXX Long VIX Long VIX Weekly Futures Strategy ETF (BATS:VMAX) and the REX VolMAXX Inverse VIX Weekly Futures Strategy ETF (VMIN). Both will start with an NAV of $25 per share. These ETFs are the first products on the market that will provide exposure to the VIX weekly futures market which started trading on July 23 of 2015, roughly a year ago. I had a chance to sit down with the team that created these ETFs and discuss its goals and aspirations for these new products.
The issuer of these two new volatility ETFs is REX Shares, a new start-up ETF outfit headed by Greg King. Greg King, largely unknown to the retail volatility investor, has an impressive track record in the ETF industry. He headed the iPath ETN platform at Barclays where he came up with the concept of the Exchange Traded Note (ETN) and created the first volatility ETN in 2009 - the iPath S&P 500 VIX Short-Term Futures ETN (VXX). Subsequently, he founded the ETF company VelocityShares, which was eventually acquired by Credit Suisse (CS) and which gave us the second and most popular volatility ETN in 2011 - the VelocityShares Daily Inverse VIX Short-Term ETN (XIV). Today, VXX and XIV are the two oldest and most popular volatility products and command a combined AUM of more than $2 billion on any given day. Greg King is a true visionary in the ETF world, and we owe much of what we see on the ETF scene today to him. You can think of him as the Elon Musk of ETFs.
Like a good movie producer, Mr. King wasn't satisfied with his original VIX ETF creations and wanted to go bigger
