Jump to content
  • 0

VIX futures Vs VIX Spot


investCo007

Question

14 answers to this question

Recommended Posts

  • 0

The Vix can either trade at the 'spot' price, or the 'futures' price. The Spot is purely an indication of the market volatility on the S&P 500, however you can't physically buy or sell it (in much the same way as you can't buy or sell a 'FTSE' or a 'DAX' - these are just indications). 

 

You can however buy a future VIX contract, which is what the Vix on the IG platform is based off. VIX futures reflect the market's estimate of the value of the VIX Index on various expiration dates in the future. Monthly and weekly expirations are available in the underlying market and the contract we currently have on IG is the June 18. They trade nearly 24 hours a day, five days a week.

 

You can learn more at the CBOE website under the VIX futures tab. http://www.cboe.com/vix

 

2018-05-30 08_39_41-Vix-Index.png 

Link to comment
  • 0

sorry still confused...... vix term struct is in backwardation  so settlement price on jun contract should be higher than the the theoretical spot price no?

 

is there any way you could show me a graph of the first say 4 months as they move throuh this volatile time frame?

 

sorry to be a pain but it would really jelp hey my head straight?

Link to comment
  • 0

also don't forget that VIX spot moves with the market fluctuations in real time, whilst the futures are going to have a different correlation coefficient over periods of high vol. Think of it this way - market has a MAD day so VIX moves like crazy because its an index value of RIGHT NOW. Futures smooth that out a little so there will be periods where it doesn't follow the basic logic of the curve.

Link to comment
  • 0

jun contract is about as close to s[pt as you can get given its may so smoothing effect should be minimal. From the BB screenshot what is the exact contract wekk, 1 2, etc? Can you sent be full price series from bloomberg and IG of THAT specific contract vs spot price series for those days where it spiked.

 

many thanks

Link to comment
  • 0

Hi, I'm sorry but I'm not sure where you are getting a value of 20 from? According to that link there is a HLO of 13.65, 13.5 and 13.6 respectively. The IG live platform reflects this as below (with the IG spread). I have also had a look on Bloomberg and these figures reflect accurately. Maybe I have misunderstood but I don't see where the '20' value is coming from... from that link the last 20 value was back in April.

 

2018-06-06 08_48_09-IG Trading Platform _ Spread Betting.png

Link to comment

Join the conversation

You are posting as a guest. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Answer this question...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

  • General Statistics

    • Total Topics
      16,004
    • Total Posts
      76,703
    • Total Members
      63,925
    • Most Online
      7,522
      10/06/21 10:53

    Newest Member
    VictorKDP
    Joined 17/09/21 17:23
  • Posts

    • Not a surprise at all. 'The managing director of a company which runs four Yorkshire care homes said he may need to keep on employees who have not been fully vaccinated against COVID-19 after the govt makes it a legal requirement for all care workers in November.' Luther @LutherBurgsvik  5h Yorkshire care home boss 'considering' keeping on unvaccinated staff after deadline | Yorkshire Post
    • Competition How can 'competition' affect traders? Competition is the pressure to make more money or place more trades than others. While trading is considered a competitive practice, traders should have the patience and discipline to follow their own trading rules and plan. Competition can cause a trader to adopt bad habits – for example, a 'win at all costs' mentality, which could open them up to negative emotions and impulsive trading decisions. A study by Dijk has found that traders put up 50% more in a risky situation when peers would be aware of their decisions than when they were in an isolated individual setting. Not only should traders be wary of competing against each other, they also shouldn't compete with themselves. By trying to beat a record or increase a profit every day, traders might be forcing themselves into trades that they wouldn't normally make. How can traders avoid competition? To avoid competition, you can create a routine that is based on your trading plan and risk management strategy. One popular tool is a trading diary, which helps you keep record of your trades – including why you entered them, the expected profit, how you chose to minimise your market risk, your entry and exit points, and how the market behaved. You should focus on yourself, as there is more potential in self-development and learning than in competing with others. Things to keep in mind...
    • News How can the 'news' affect traders? The news can put pressure on traders to make certain decisions and interpret information in a particular way. News is a crucial part of information gathering, but it's important for traders to interpret the news objectively. Forythe, Nelson, Neumann and Wright studied 192 traders' opinions on US elections and found that the individuals who dispassionately interpreted the news, and resisted confirmation bias, were more likely to make a profit. In contrast, those who traded the news and exhibited availability bias became overconfident and this increased their risk. How can traders use financial news? Using financial news is a great way to stay abreast of changes in the market and to help you fine-tune your strategy, but it is important not to become over-reliant on one source as this can create a narrow view of the market. Fundamental analysis is a common way of gathering information. It is the use of various internal and external factors – like news, macroeconomic data and company announcements – to decide how much a particular asset is worth. However, it is also important to use technical analysis too. This can help you predict the future direction of a market's price, by studying historical chart patterns and formations. It involves applying technical indicators, such as Fibonacci retracements and moving averages, to identify price patterns and key levels. Things to keep in mind...
×
×
  • Create New...