2x Long VIX Futures ETF (UVIX)

[lostsoul]

The 2x Long VIX Futures ETF (UVIX) is a leveraged exchange-traded fund (ETF) designed to provide investors with twice (2x) the daily performance of the Long VIX Futures Index (LONGVOL), before fees and expenses. Issued by Volatility Shares, UVIX tracks a portfolio of first- and second-month VIX futures contracts, which are rolled daily to maintain consistent maturity. The VIX, often called the "fear index," measures expected market volatility of the S&P 500 over the next 30 days.

Description	Shares/Contracts	Market Value/Notional
CBOE VIX FUTURE May25	3,975	$72,623,250.00
CBOE VIX FUTURE Jun25	27,822	$541,694,340.00
Cash & Other	307,063,384	$307,063,383.57

Data as of 05/16/2025.
Cash & Other includes cash, other accrued assets & liabilities, & shares of money market funds that invest in U.S. government securities. Holdings are subject to change.

UVIX is a high-risk, short-term trading tool primarily used by sophisticated investors to hedge against market downturns or speculate on volatility spikes. It aims to amplify daily returns, meaning if the LONGVOL Index rises by 10% in a day, UVIX targets a 20% gain (and vice versa for losses). However, due to leverage compounding, contango (when longer-dated futures are pricier), and volatility drag, holding UVIX long-term can lead to significant losses, especially in calm markets. It does not pay dividends and has a high expense ratio of around 2.19–2.78%. Launched on March 30, 2022, UVIX trades on the Cboe BZX Exchange under the ticker UVIX.

Key Risks: Extreme volatility, potential for rapid losses, tracking errors, and unsuitability for long-term investment. Always review the prospectus before trading.

Performance Overview (trailing returns as of 5/15/2025):

YTD Return: -17.97%

1-Year Return: -56.63%

3-Year Return: -85.95%

[lostsoul]

UVIX 的先行者。
他从 20 拿到 100。我从 27 拿到 33 就已经憋不住了，根本不可能。

[lostsoul]

Grok:

What Happens If Too Many People Buy UVIX? Will the Price Go Up Even When VIX Futures Are Down?

Overview

The 2x Long VIX Futures ETF (UVIX) is designed to deliver twice (2x) the daily performance of the Long VIX Futures Index, which tracks first- and second-month VIX futures contracts. Its price is influenced by market supply and demand, the performance of VIX futures, and ETF mechanics. Below, we analyze what happens when many investors buy UVIX and whether its price can rise if VIX futures are declining.

Impact of High Demand for UVIX

1. Increased Demand and Share Price Pressure

• Market Price Dynamics: Heavy buying of UVIX increases demand, which can push its market price above its Net Asset Value (NAV), causing UVIX to trade at a premium. The NAV reflects the value of its holdings (VIX futures and cash).
• Creation/Redemption Mechanism: Authorized Participants (APs) can create new UVIX shares by delivering cash or VIX futures to the fund, increasing share supply. This process typically aligns the market price with the NAV, limiting sustained premiums.

2. Effect on VIX Futures

• Portfolio Composition: UVIX holds VIX futures contracts (e.g., 3,975 May 2025 and 27,822 June 2025 contracts, per recent data). Significant UVIX buying may require the fund or APs to purchase additional VIX futures to maintain 2x leverage.
• Futures Price Impact: Increased demand for VIX futures could drive up their prices, particularly for front- and second-month contracts, boosting UVIX’s NAV and supporting its share price, even if VIX futures are otherwise trending down.

3. Market Liquidity and Volatility

• Liquidity Constraints: VIX futures are less liquid than equities. A surge in UVIX buying could strain futures market liquidity, leading to wider bid-ask spreads or temporary price dislocations in UVIX’s share price.
• Arbitrage Correction: Market makers and APs arbitrage any price discrepancies, ensuring UVIX’s price tracks the 2x daily performance of the Long VIX Futures Index over time.

Can UVIX’s Price Rise When VIX Futures Are Down?

UVIX tracks the Long VIX Futures Index, not the spot VIX Index. VIX futures reflect expectations of future volatility, which can diverge from current VIX levels. Here’s how UVIX’s price behaves when VIX futures decline:

1. Short-Term Price Increase

• Demand-Driven Premium: Heavy buying can temporarily push UVIX’s market price above its NAV, causing a price increase, even if VIX futures are falling. For example, intense buying might result in a 2% premium (e.g., from $27.64 to $28.20).
• Futures Price Support: If UVIX’s buying pressure increases demand for VIX futures, their prices may rise or decline less than expected, supporting UVIX’s NAV and share price in the short term.

2. VIX Futures vs. Spot VIX

• Contango and Backwardation: VIX futures are often in contango (futures prices higher than spot VIX), common in calm markets. If futures prices remain elevated due to demand, UVIX’s price could rise temporarily, even if the spot VIX or futures are declining.
• Example: If June 2025 VIX futures rise due to speculative buying (anticipating future volatility), UVIX’s NAV could increase, offsetting a broader futures downtrend.

3. Limits to Price Increases

• Leverage and Daily Reset: UVIX’s 2x leverage means it aims to deliver twice the daily percentage change of the Long VIX Futures Index, before fees (~ 2.36% expense ratio) and roll costs. If VIX futures fall (e.g., 3% daily), UVIX’s NAV drops ~ 6%, and its share price follows, regardless of buying pressure.
• Creation/Redemption: APs create new shares to meet demand, eliminating premiums and aligning the market price with the NAV, which is tied to declining VIX futures.
• Contango Losses: In contango, rolling futures (selling expiring contracts, buying later-dated ones) erodes UVIX’s value, counteracting any demand-driven price gains over time.

4. Extreme Scenarios

• Liquidity Overwhelm: If buying overwhelms VIX futures market liquidity, futures prices could spike, and UVIX might trade at a significant premium temporarily. However, arbitrage corrects this quickly.
• Sustained Declines: If VIX futures continue falling (e.g., due to low market volatility), UVIX’s price will decline due to volatility drag, contango, and leverage compounding, even with heavy buying.

Example Scenario

• Day 1: VIX futures fall 3% due to declining volatility expectations. UVIX’s NAV would drop ~ 6%. However, heavy buying pushes the share price to a 2% premium (e.g., $27.64 to $28.20), and futures buying limits their decline to 1%, reducing UVIX’s NAV drop to ~ 2%.
• Day 2: VIX futures fall another 3%. APs create new shares, eliminating the premium. UVIX’s price aligns with its NAV, dropping ~ 6%, erasing prior gains.
• Outcome: Buying may delay losses briefly, but UVIX’s price falls if VIX futures decline.

Key Considerations

• High Risk: UVIX is a short-term trading tool (1–2 days) unsuitable for long-term holding due to volatility drag, contango, and leverage compounding.
• Market Sentiment: Heavy UVIX buying may signal anticipated volatility, supporting futures prices temporarily, but structural losses dominate in declining futures markets.
• Investor Caution: Monitor VIX futures data and UVIX’s prospectus. Heavy buying cannot sustainably decouple UVIX’s price from its underlying index.

Conclusion

Massive buying of UVIX can temporarily increase its share price, potentially at a premium to its NAV, and may support VIX futures prices, allowing the price to rise even if VIX futures are declining. However, this effect is short-lived due to the ETF’s creation/redemption mechanism, 2x leverage, and contango costs. Over time, if VIX futures fall, UVIX’s price will decline, making it a high-risk investment in low-volatility environments.

[suzziechu]

歇歇啦，周五晚上啊。。。。

[lostsoul]

歇歇啦，周五晚上啊。。。。

哈哈，刚刚想起来羊倌以前问过类似的问题。

[lostsoul]

再建仓 $27.50