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  • Josh Krause
    Volatility Players: The time has come for some long volatility exposure, but remain cautious. http://seekingalpha.com/a/h7wf
    8/13/12
    Reply (19)
    • Perkins Cove: Thanks again for your articles/stocktalks on the VIX. You have turned your negative experiences into positive gains for others. Kudos.
      8/14/12
    • ChrisGriffith: Josh - with the term structure as it is with september at $15.20 and october at $18.60, although spot VIX is below 15, does this steep
      8/21/12
    • ChrisGriffith: contango warrant going long XIV?
      8/21/12
    • Josh Krause: It could but I would take profits quickly. We are 105% dependent on central bqnk actions at this point.
      8/21/12
    • ChrisGriffith: Right, I'm thinking to do it after the Fed minutes come out. The market's going to throw a hissy fit when the fed doesn't commit to QE3
      8/21/12
    • Israel Shenker: Chris, the August contract came off the board at the close today. Contango is now rolling September 18.75 to October 20.75 starting tomorrow
      8/21/12
    • ChrisGriffith: ok izzy, so looking at the prices now, the VIX is at 16.03, VIX/U2 (which I'm guessing is september) is at 19.35 and VIX/V2 (october?) is
      8/23/12
    • ChrisGriffith: at 21.52. So when i'm looking to make a play based on contango, do i only want to compare the sept and oct prices, or look at spot (16) too?
      8/23/12
    • Perkins Cove: Josh, "August 13". And still the VIX is flat at August 23rd. Except for out-of-the-blue spikes.....the play is short VIX derivatives.
      8/23/12
    • Perkins Cove: Or, no play at all. The UVXY chart is going lower every day, what with contango. May I posit that VIX trades are short term only......
      8/23/12
    • Perkins Cove: ....best played AFTER a spike (ie, short)...? TIA
      8/23/12
    • Josh Krause: VIX trades do tend to be short term. The only long term trade is either use an alternate vehicle like VQT or long XIV after a spike.
      8/23/12
    • Josh Krause: You look at spot and the futures. The futures will tend to trend down towards the spot and therefore you will lose both ways.
      8/23/12
    • Josh Krause: The spread between spot and front month, especially near the beginning of the month, and the spread between months detemine the contango
      8/23/12
    • Perkins Cove: In simple man's lingo....the VIX derivatives have lost their trading edge, because of contango. Right?
      8/23/12
    • ChrisGriffith: i would think the variance b/t the spot vix and front month future is decently large enough now to go long XIV...
      8/23/12
    • Perkins Cove: A vehicle where you can "lose both ways" is not a "good thing", as Martha Stewart would say.
      8/23/12
    • Israel Shenker: VIX long-term mean is 19 with about a month to go to expiration the correlation between any VIX move is about 50%.
      8/23/12
    • Israel Shenker: A mean reversion of the VIX to 19 would drive the front month to about 21.50
      8/23/12