What is VXXB & How Does it Work? On January 29th, 2009, Barclays launched VXX, an exchange-traded note (ETN) designed to track movements in the S&P 500’s implied volatility, which is measured by the VIX Index. If you’re interested, read our in-depth post on how VXX worked. VXX was wildly successful with millions of share/note volume […]
Why Does Implied Volatility Change? (Options Trading Tutorial)
Why Does Implied Volatility Change? (Options Trading Tutorial) Implied volatility is a crucial options trading concept for beginners to understand, but it can be a daunting thing to learn because it seems very complex. While the math behind calculating implied volatility is complex, all we need to know as options traders is this: ➜ Implied volatility quantifies option prices […]
IV Rank vs. IV Percentile: Which is Better?
IV Rank vs. IV Percentile: Which is Better? All stocks in the market have unique personalities in terms of implied volatility (their option prices). For example, one stock might have an implied volatility of 30%, while another has an implied volatility of 50%. Even more, the 30% IV stock might usually trade with 20% IV, […]
Trading VIX Options (3 Things You Need to Know)
Trading VIX Options: Things You Need to Know The Cboe VIX Index is an index that measures the prices of 30-day option prices (implied volatility) on the S&P 500 Index (SPX). However, the VIX is just an index that measures SPX option prices and does not have any shares that can be traded.Fortunately, the VIX […]
VIX Term Structure – The Ultimate Guide
The VIX Term Structure (VIX Futures Curve) Explained The VIX term structure (sometimes called the “VIX futures curve”) is the relationship between the prices of short-term and long-term VIX futures contracts. The shape of the VIX futures prices when plotted (upwards, downwards, or flat) indicates whether the market is expecting more or less market volatility in […]
Trading VIX Futures | Volatility Product Guide
Trading VIX Futures: What You Need to Know The Cboe VIX Index measures prices of 30-day option prices (implied volatility) on the S&P 500 Index. Since option prices are an indicator of fear or complacency in the marketplace, the VIX is sometimes viewed as a “fear index” that gauges the level of uncertainty in market […]