VXST Futures and VIX Index Both Rose More Than 26% Today

In a July 26 piece that now looks as if it could be rather prescient, in last weekend’s Barron’s, Steve Sears wrote –

“BlackRock, the world’s largest asset-management firm, is telling clients that equity-options volatility is now the last cheap asset class in the financial market. With the CBOE Volatility Index (VIX) at about 11.50, around half of its long-term average of 19, BlackRock is telling clients that the measure should be in the mid- to high-teens. This view is consistent with our previous recommendations that investors buy volatility in anticipation of VIX increases in reaction to shifting Federal Reserve monetary policy or continuing geopolitical instability in Ukraine and the Middle East. …”

CHART SHOWING SIX TRADING DAYS

The chart below shows that the VIX spot Index and VXST futures (expiring on Aug. 6) both moved pretty closely in tandem.

VXST chart for 7 31  Blog

TABLE

The table below shows today’s price moves for CBOE’s 26 volatility indexes and the near-term VXST futures.  Both the VIX spot index and the VXST August Week 1 futures rose more than 26.1% today.

Table July 31 Blog

To learn more about futures and options on several volatility indexes, please visit www.cboe.com/volatility.