ProShares Short VIX Short-Term Futures ETF (SVXY)
ProShares Short VIX Short-Term Futures ETF: Not A Viable Option Right Now
The ProShares Short VIX Short-Term Futures ETF is rated Hold due to limited near-term upside and high tactical risk. SVXY is best used as a short-term trading instrument after significant volatility spikes, not as a long-term holding. Current macroeconomic uncertainty, upcoming economic data, and potential Fed actions make precise timing for SVXY especially challenging.
SVXY: Tactical Tool To Take Advantage Of A Falling VIX
SVXY is a high-risk ETF designed to deliver -0.5x the daily performance of the S&P 500 VIX Short-Term Futures Index. Current low market volatility makes it an inopportune time to bet on further volatility declines, so I rate SVXY as a Hold. Understanding when to go long or short volatility is crucial, especially in markets with overvalued stocks and sentiment-driven pricing.
SVXY: Taking Profit Amid Growing Prospects Of Another VIX Spike
The ProShares Short VIX Short-Term Futures ETF has performed well, since we upgraded our rating from "Hold" to "Strong Buy" on 9 April. The SVXY has gained by around 11.9% while the Cboe Volatility Index has dropped by around -30.0% over the same period (based on prices at the time of publication). Given the increasing risks of a highly volatile equity environment, we think the potential reward for shorting volatility no longer adequately compensates for the risk of another spike on the VIX.
SVXY: Volatility Got Crushed After The Election Results (Rating Downgrade)
ProShares Short VIX Short-Term Futures ETF benefits from falling volatility; post-election VIX normalization makes it less attractive, prompting a 'Sell' rating to take profit. SVXY is not suitable for buy and hold due to potential significant drawdowns from sudden volatility spikes. The fund should be bought when VIX spikes due to external events and sold after volatility subsides.
SVXY: Buy Volatility After A -40% Drawdown
SVXY experienced a -40% drawdown following a spike in the VIX on August 5, 2024. The ETF aims to provide a -0.5x return against the S&P 500 VIX Short-Term Futures Index. SVXY performs well in calm markets and normal bear markets, but experiences losses during sudden spikes in volatility.
Why Chasing Volatility With a VIX ETF Is Trickier Than It Seems
U.S. investors looking for positive returns had few options on Monday. Stocks tumbled while Treasury bond prices pared early gains.
SVXY: More Aggressive Version Of SVOL
ProShares Short VIX Short-Term Futures ETF (SVXY) offers 0.5x exposure to shorting VIX futures, making it a unique "leveraged" ETF. SVXY has outperformed the highly popular Simplify Volatility Premium ETF (SVOL) and the overall market in the last 3 years. SVXY behaves differently in extreme cases, such as during the market drop in March 2020, but has performed well overall.
SVXY: Don't Get Wiped Out
Markets love volatility, but current conditions suggest a high volatility risk-off event is possible in the near-term. The ProShares Short VIX Short-Term Futures ETF has performed well by shorting volatility, but it carries the risk of crashing. The counterparty risk and potential for significant losses make SVXY a risky investment, especially during periods of market turmoil or heightened volatility.
SVXY: The Short Volatility Trade Is Getting Overextended
Volatility sellers have profited from the rebound in equity prices in 2023, but selling at current levels could be risky due to potential increases in volatility. Despite equity volatility returning to 2021 levels, market dynamics have changed with monetary policy acting as a headwind and less aggressive fiscal policy. Bond volatility remains high compared to equities, suggesting that equity volatility traders may have discounted market risks too quickly.
SVXY: Picking Pennies In Front Of A Steamroller
We assessed the risk-reward for both the long and short sides of trading the VIX, and briefly discussed several common trading strategies. For traders holding onto the ProShares Short VIX Short-Term Futures ETF (SVXY), the act of shorting the VIX resembles that of "picking up pennies in front of a steamroller".
SVXY: A 'Sneaky Good' Way To Be Bullish On The S&P 500
SVXY is a small group of quirky but often effective ways to profit when the S&P 500 rises in price. This ETF aims to profit from falling volatility. That is, when the VIX volatility index drops. That is typically associated with periods in which the S&P 500 is rising.
Inverse, Double VIX ETFs Return
The strategies return four years after a VIX spike wiped out billions in short volatility ETPs.
VIX ETFs Surge as Stocks Continue to Tumble
Volatility exploded on Monday as stocks, index futures, and stock ETFs tumbled, following the S&P 500′s worst week since March 2020, as investors and traders expected more corporate earnings results and awaited a major policy move from the central bank this week. The Dow Jones Industrial Average plunged almost 1100 points, or 3.1%, losing ground [.
SVXY: Short Vol Trade Exposed To Fund Blow-Ups
SVXY epitomizes the short volatility trade. Popular with money managers the world over as markets perpetually rise.
Investors Embrace Inflation Protected Bond Funds And ETFs In July
For the second month running, mutual fund investors were net sellers of fund assets, redeeming $15.0 billion from conventional funds for July.
VIX Sub 20: The Short Volatility Trade Is Back
Historically, the short VIX trade has been appropriate with VIX under 20. ProShares Short VIX ETF benefits from falling VIX.
SVXY: A Solid, Long-Term Volatility Play
SVXY is an instrument which is built around shorting an index that declines almost all of the time. The primary reason to buy SVXY over lengthy time periods is its ability to capture futures convergence.
SVXY: Short The VIX
The VIX is somewhat elevated against historical norms, which suggests that it will probably fall over the next month. SVXY has the potential to be a very consistent contributor to a portfolio, provided proper risk management is in place.
ProShares to Transfer Four Funds to Cboe BZX Exchange
BETHESDA, Md.--(BUSINESS WIRE)--ProShares, a premier provider of ETFs, today announced that it will transfer the listing of four ProShares ETFs from NYSE Arca to the Cboe BZX Exchange on or about December 16, 2020. Current shareholders of these ProShares ETFs are not required to take any action, nor is the transfer expected to have any effect on the trading of fund shares. The following ETFs are transferring to the Cboe BZX Exchange: ProShares ETF Ticker ProShares Short VIX Short-Term Futures E
SVXY: A Solid Long-Term Play
SVXY is half-leveraged shorting an index which has declined at an annualized pace of nearly 50% per year for the last decade. Shorting VIX futures convergence makes for a solidly-winning trade, provided your time horizon is long enough.