4 min readBy Beqa Bumbeishvili ETF Insider
How does the SVIX ETF work?
The SVIX ETF is a specialized investment fund that focuses on a specific sector. This exchange-traded fund offers investors exposure to a range of companies in this sector.
The issuer of the SVIX ETF is dedicated to providing investors with a unique way to gain exposure to the volatility market. The Short VIX Futures Index, which the fund aims to track, measures the daily inverse performance of a portfolio of first and second-month VIX futures contracts. With a focus on replicating the Index's performance for a single day, the SVIX ETF offers a specialized investment opportunity for those looking to navigate the intricacies of the VIX futures market.
While the primary objective of the SVIX ETF (SVIX) is to track the daily inverse performance of the Short VIX Futures Index, its dividend distribution is a reflection of the underlying index. Dividends from SVIX are typically not a major focus, as the ETF primarily seeks to achieve daily investment results based on its index. Dividend distributions, if any, would be influenced by the dividend policies and performances of the VIX futures contracts held by the ETF. Investors interested in SVIX may primarily consider it for its potential to deliver daily inverse returns rather than dividend income.
The SVIX Tracking ETF aims to replicate the daily performance of the Short VIX Futures Index. This index measures the inverse daily performance of a portfolio consisting of first and second-month VIX futures contracts. To achieve this objective, the SVIX Tracking ETF maintains exposure designed to closely mirror the movements of the Short VIX Futures Index, making it a valuable tool for investors seeking to hedge against market volatility or speculate on VIX futures' inverse performance.
The correlation aspect of the SVIX Short VIX ETF (SVIX) is primarily tied to its objective of inversely tracking the Short VIX Futures Index. This ETF aims to provide daily inverse performance relative to a portfolio of first and second-month VIX futures contracts. Given this strategy, SVIX is expected to exhibit a strong negative correlation with the CBOE Volatility Index (VIX), often referred to as the market's fear gauge. Traders and investors interested in profiting from or hedging against market volatility fluctuations frequently analyze SVIX's correlation with the VIX to make informed trading decisions.
The SVIX ETF, which seeks to match the daily inverse performance of the Short VIX Futures Index, primarily operates within the volatility and derivatives sectors. The Short VIX Futures Index measures the daily inverse performance of a portfolio of first and second month VIX futures contracts. As such, SVIX is geared towards investors looking to hedge against or profit from increased market volatility. It's important to note that this ETF is designed for short-term exposure and may not be suitable for long-term investment strategies.
The exposure characteristic of the SVIX ETF emphasizes its focus on providing investors with daily inverse performance to the Short VIX Futures Index. This index measures the inverse performance of a portfolio of first and second-month VIX futures contracts. The SVIX ETF seeks to deliver daily investment results that align with this index''s performance, making it a valuable tool for investors looking to profit from market volatility changes on a daily basis.
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4 min readThe SVIX ETF is a specialized investment fund that focuses on a specific sector. This exchange-traded fund offers investors exposure to a range of companies in this sector.
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