Volatility-Linked ETNs Plunge
ETF Daily News | Sep 11, 2017 12:02PM ET
Analyst/ETF Trader Paul Weisbruch of Street One Financial brings us his daily fund flows update, which today looks at renewed inflows into small caps amid today’s big equities rally and a corresponding downturn in long volatility products.
Inflows continue to trickle in to small-cap IWM, with about $1 billion entering the fund lately via creation activity. While the fund is still well off its highs of late July, with the Nasdaq 100 and S&P 500 trading above their record closing highs, the motivation of these flows lately is rather clear.
We are thus watching TNA rather closely here, given the IWM inflows and the strength in global equities this morning.
Elsewhere, we note that after a surge in early to mid-August, long Volatility ETPs are once again sinking on the resumption of strength in equities (and the VIX itself below $11 once more today). VXX (which underwent yet another reverse split recently) is down more than 5% today, and threatening to give back all of its gains since its early August all-time lows. VXX has still attracted a net over $545 million in year-to-date creations, despite its never-ending losses from a long-term perspective.
The iPath S&P 500 VIX Short Term Futures TM ETN was trading at $46.17 per share on Monday morning, down $2.35 (-4.84%). Year-to-date, VXX has declined -54.75%, versus a 12.22% rise in the benchmark S&P 500 index during the same period.
VXX currently has an ETF Daily News SMART Grade of F (Strong Sell), and is ranked #7 of 12 ETFs in the Volatility ETFs category.
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.