More on Volatility ETN’s - VXX, XIV, VQT

By Lawrence G. McMillan

In the last issue, we laid out a trading system for VXX and XIV, the most liquid short-term volatility ETN’s.  VXX uses the two front-month $VIX futures contract to create an instrument that tracks near-term volatility directly, while XIV is the inverse of the same thing.

We had left a few questions open at the end of that previous article, and we aim to answer those in today’s issue.  Moreover, some reader questions have been asked as well, and we will address those too, since they are important to the overall concept.  

Finally, in keeping with the theme, we are also going to discuss another Barclay’s Bank ETN – the S&P 500 Dynamic VEQTOR ETN, more commonly known as VQT...

Get the entire More on Volatility ETN's article (published on 2/24/12) including the conclusion to the VXX Trading System and the back testing results by subscribing to The Option Strategist Newsletter.