Seeking Alpha

XIV supplants VXX among volatility ETNs

  • Perhaps just a matter of time as short volatility strategies have paid off far better than long ones in recent years (though not so far in 2014), the VelocityShares Daily Inverse VIX Short-Term ETN (XIV) has shoved aside the S&P 500 VIX Short-Term Futures ETN (VXX) as the most popular volatility-based ETN. The XIV had about $778M in AUM as of the end of last week vs. roughly $711M for the VXX.
  • The XIV doubled in 2012, according to ETF Trends, and did so again last year. Another VelocityShares inverse volatility offering, the Daily Inverse VIX Medium Term ETN (ZIV) is also seeing a good deal more interest - its share count has doubled in the past six months.
  • As for Seeking Alpha Real Time Alerts Subscribers: The VXX has 8,935, the XIV 2,166, the ZIV 347.
Comments (3)
  • DeepValueLover
    , contributor
    Comments (8137) | Send Message
     
    If this isn't a major contrarian indicator then NOTHING is.
    10 Feb, 11:32 AM Reply Like
  • alkmaar
    , contributor
    Comments (30) | Send Message
     
    I don't see why this is a contrarian indicator.

     

    I know the AAII survey is, with people bullish at ~27% as of last week, below the historical avg of ~39%.
    10 Feb, 05:26 PM Reply Like
  • Interested18
    , contributor
    Comments (6) | Send Message
     
    Was thinking the same. Also curious as to how large these strategies get before they distort the vol curve and change the long term returns on these products. Anyone seen anything on that?
    10 Feb, 02:38 PM Reply Like
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