All-Time Lows Aren’t Stopping Investors From Buying Volatility ETFs

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December 22, 2016 11:35am NYSE:UVXY

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Analyst Paul Weisbruch of Street One Financial in his daily fund flows update points out continued interest in a couple of volatility funds, despite them continually hitting all-time lows.


At the risk of sounding like a broken record for the umpteenth time, we once again repeat here that “Long Volatility” ETPs such as VXX (iPath S&P 500 VIX Short-Term Futures ETN) and UVXY (ProShares Ultra VIX Short-Term Futures ETF) are trading at new all-time lows once again this morning, although the VIX itself is not at an all-time low.

In fact, the VIX is actually up nearly 1% this morning in early trading. This poor short-term performance has not shaken out any holders though, according to fund flows data that we are observing. VXX  has seen $100 million worth of net inflows in the trailing one month period, while UVXY has received $68 million in same timeframe.

Elsewhere, recent larger creation activity in SPY pre-FOMC rate decision last week has actually reversed in the last twenty four hours to net outflows in SPY. That’s perhaps not unexpected, considering that the S&P 500 itself fell from recent intraday highs of 2277.53 that it touched eight trading sessions ago. In the past day, in fact, we’ve observed some $4 billion leaving the SPY as investors and fund managers might be getting a little cautious heading into 2017.


Disclaimer: The content of this article is excerpted from a daily newsletter from Street One Financial. While ETF Daily News may edit the contents and add a relevant title to the piece, the author, Paul Weisbruch, does not endorse or recommend any issuer or security mentioned herein.

About the Author: Paul Weisbruch

paul-weisbruchPaul Weisbruch is the VP of ETF/Options Sales and Trading at Street One Financial. Prior to joining the team at Street One, Paul served as the Director of RIA and Institutional ETF Sales at RevenueShares ETFs from December 2007 until November of 2009. Before RevenueShares, Paul was employed by Susquehanna International Group from 2000 until 2007 serving in roles including OTC/NYSE Institutional Block Trading, Nasdaq/OTC Market Making, ETF/Derivatives Intelligence and Strategy, Algorithmic Trading, as well as acting as the PHLX Floor Specialist in the ETFs, SPY and DIA.Paul has been actively involved in the ETF space from both a product and trading standpoint since 2000. Additionally, Paul has well forged relationships with national RIAs, institutional pension fund managers and consultants, mutual fund and hedge fund managers, and also the ETF media. Co-authoring the “S1F ETF Daily” since 2009, the daily piece has become a must for many portfolio managers in the ETF space, with segments regularly appearing in the likes of Barron’s, WSJ, and ETFTrends.com for instance.

He holds his Series 4 (Registered Options Principal), 6, 7, 55 (Equity Trader), 63, and 65 licenses. He graduated from the University of Pittsburgh (B.S. – Economics), graduating magna cum laude, and has an MBA from Villanova University.


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