etfmsolutions: The VIX via VDX, M1 and the CBOE.....03.16.16

Wednesday, March 16, 2016

The VIX via VDX, M1 and the CBOE.....03.16.16

Here's the latest VDX and M1 spin on the VIX volatility index. Keep in mind the M1 results are really only useful in assessing daily risk/reward since the VIX can only be bought/sold in the form of options and futures, which are themselves highly volatile intraday..
Can I just use VXX as a proxy for VIX and achieve similar results you may ask. The short answer is NO, which is largely due to the time decaying derivatives that IPATH uses to construct VXX.
With the VIX hitting 15 today at the FED announcement the odds are we're going to see it go up.
Below are a couple tactical approaches to VIX trading thanks to my friends at the CBOE.
(These are examples only of how to set brackets and do NOT reflect current VIX values.)

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