VIX Tempest Plays Havoc With Volatility Notes Taking Futures Cue
- Post-Brexit price swings have roiled exchange-traded products
- Inverse ETN fell along with spot VIX on Monday amid turmoil
This article is for subscribers only.
The market convulsions of the last week have been a lesson in the complexity of volatility markets for investors who bought exchange-traded notes tied to turbulence in equities.
Owners of the wildly popular exchange-traded securities have been whipsawed day after day as the benchmark measure for stock volatility bobbed and weaved in the aftermath of the U.K. referendum. Some of the moves were straightforward reactions to the up-and-down motion of the VIX, others a byproduct of less-visible currents in futures markets.