The Volatility ETF Landscape: UVXY | VXX | Big Profit Potential

There are many Volatility ETPs with various leverage factors and structures that traders can use to gain exposure to the world of Volatility trading. This video introduces the current Volatility ETF Landscape that we will unpack throughout this course.
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Brent Osachoff
#volatilitytradingstrategies #optiontrading #shortvolatility #UVXY

[@VolatilityTradingStrategies]

Claim your FREE Trial to VTS: www.volatilitytradingstrategies.com/subscribe I answer all comments so ask me anything!

[@tomer-8052]

Super professional. You are the best teacher I've ever encountered. Best articulation, speak so clear, and the graphics are perfect. Thank you very much

[@VolatilityTradingStrategies]

Wow, high praise, thank you!

[@cars2drive298]

I m an ex prop volatility trader for BNP Paribas and traded short VXX ETF mainly since it s existence, it s the 1st time I see a good explanation about this product, I could explain it to anybody interested in finance but nobody without a strong background in options can understand the complicated structure of options & futures markets and time decay.., so it will stay a gold mine only for insiders , the long side is so much difficult to catch because it s like being able to predict black swans events.., so short is the trade to do, hedge when the times get rough and short more during the crisis…compared to stock, the VIX value can only go between 10 and 80.. ( 82.69 highest value since 1990..) and when above 30, it doesn’t stay long above that level ..

[@VolatilityTradingStrategies]

Yes, thanks for the comment and glad you've had success trading them. One little thing though, the VIX does not have a max. It went to 172 in 1987. It's just a calculation of S&P 500 Options activity, so anything those Options can do, the VIX can do as well. We just haven't had a major spike last long enough to go higher than the 80's but it definitely can. It likely would have in Covid if they didn't come in and spent trillions to save the market.

[@biencomportado]

Man this was the channel I was looiking for. I will stay tunned!! Thank you for the clarity! 🔥🔥🔥🔥

[@VolatilityTradingStrategies]

Awesome, thanks for the support

[@techstack5424]

Same here 😅

[@TLATRADER]

Professional as always. Thanks for the overview.💪

[@VolatilityTradingStrategies]

Appreciate it

[@choclatechips9085]

Thank you very much for the explaination.

[@Biggsneeky]

@VolatilityTradingStrategies what time frames are you trading UVXY? Are you trading on the 1m, 5m, 10m, 15m, 30m, 45m, 1hr, 2hr, 4hr or 1D charts? Please advise and thanks in advance Mr. Brent!

[@VolatilityTradingStrategies]

Actually none, I don't day trade UVXY in that sense. I have several Options strategies on the Volatility ETFs, mostly weekly and monthly time frames, and then some tactical rotation strategies that tend to switch positions about 2-3 times per month. So more medium term time frames. The only advantage to Volatility ETPs is the natural decay due to the roll yield, but of course that requires time to play out. If you're day trading UVXY, you're not really trading Volatility, you're just stock trading at that point. The roll yield doesn't work that fast.

[@NoahPenn13]

I love this haven’t left this channel since I came

[@VolatilityTradingStrategies]

Appreciate the endorsement, but it's ok to turn it off for a few minutes a day

[@Will-No-Co]

Thanks Brent.

[@LabdLabu]

Interesting series, can’t wait for more!

[@VolatilityTradingStrategies]

Which one are you most interested in?

[@nastynate4481]

svix seems to outperform tqqq in 2022 and very comparible in 2023 and 2024. Is it a possible buy and hold fund?

[@VolatilityTradingStrategies]

Absolutely NOT! :) When the market crashes, something like SVIX could easily see an 80 or 90% drawdown, or more. It doesn't take Volpocalyse either, just a slow grind in a recession will push SVIX way WAY down...

[@philippkantas5962]

If the UVXY is holding only 1st and 2nd vix futures only at all times how on earth UVXY options with DTE of 90 or longer are priced?

[@meismtheism1527]

Daily rebalancing between the two front months. Every day, UVXY holds more of the second month until the end of the month where the 'first' month expires and the 'second' month now becomes the new 'first' and it rebalances daily into the new 'second' month that was previously third. Rinse and repeat every day.

[@VolatilityTradingStrategies]

Yes, that guys answer is good :) One of the next videos will explain that process, it's how all the ETPs work.

[@diazo5679]

Thanks. Can wait to follow the series.

[@VolatilityTradingStrategies]

Thanks, it'll be interesting for Volatility traders

[@braddeicide]

Did you catch the early August '24 breakout? :)

[@VolatilityTradingStrategies]

Yeah, we cycled into safety on July 24th and we're actually up money in the last 10 days in all 3 of our tactical strategies. Volatility isn't extreme enough just yet to get into Long Volatility, we'll have to wait and see how next week plays out. Let's "hope" for a market crash though, that would be fun to start using Long Vol again. It's been a while....

[@jonahatch]

You forgot TVIX

[@VolatilityTradingStrategies]

TVIX was delisted years ago, the UVIX is also a 2x product so you could say it's the replacement for TVIX. The only difference is TVIX used to trade based on SPVIXSTR, and the new UVIX is based on the LONGVOL index. But structurally it's the same thing as the old delisted TVIX

[@andrewf7403]

SVOL is ONLY an M1/M2 product under normal vol conditions; it rotates through the curve tactically. You continue to be off-base with this product.

[@VolatilityTradingStrategies]

I know how the product works, and wouldn't use it myself because it's too watered down and the hedging isn't useful at all. If you like it, great!

[@rileyhobbs6139]

love your Titleist hat collection, ...suspect you're about a 2 handicap.

[@VolatilityTradingStrategies]

Titleist for life! I was sponsored by Titleist back when I was playing tournaments and it always just stuck. T-150 Irons, and still use a Titleist bullseye putter :)

[@30세전에은퇴하기]

-90% =uvxy. 😂😂😂😂

[@wubzt3r]

Check now. This is the purpose of the ETF.

[@ho2673]

@@wubzt3rgood to trade during crashes