Credit Suisse VelocityShares Daily 2x VIX Short-Term ETN Tumbles To Record Lows (TVIX, VXX, VXZ)

“A Credit Suisse Group AG security tracking the benchmark measure of U.S. options prices plunged to an all-time low, reversing ground after trading at a  record premium to its underlying assets the last four days. The VelocityShares Daily 2x VIX Short-Term ETN (NYSEARCA:TVIX), retreated 29 percent to $10.20 at 4 p.m. New York time, on volume that was 2.6  times the three-month average. Credit Suisse’s exchange-traded note closed at  $14.43 yesterday, or 89 percent above its so-called indicative value, after  falling 86 percent from its Oct. 3 peak as the Standard & Poor’s 500 Index rose 28 percent to the highest level since May 2008,” Nikolaj Gammeltoft Reports From Bloomberg.

Gammeltoft Goes on to say, “The gap between the security’s price and the value of the index it tracks has widened since Credit Suisse suspended issuance of new shares, causing a supply shortage amid record demand for volatility products that provide a hedge against U.S. equity losses. Short sellers may be accelerating bets against TVIX today on speculation Credit Suisse will permit issuance of more shares, said WallachBeth Capital’s Chris Hempstead.”

“People are waiting for Credit Suisse or VelocityShares to come out and say what’s going to happen,” Hempstead, director of exchange-traded-fund execution services at WallachBeth in New York, said in a phone interview. “The trading community believes that they will be able to create these shares again in the near future, and if that’s the case then that’s why they are shorting it.”  See more to the story: HERE

See Our VelocityShares Daily 2x VIX Short-Term ETN Category: HERE

Related Tickers: VelocityShares Daily 2x VIX ST ETN (NYSEARCA:TVIX), iPath S&P 500 VIX Mid-Term Futures ETN (NYSEARCA:VXZ), iPath S&P 500 VIX Short-Term Futures ETN (NYSEARCA:VXX).

 

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