Can you purchase vix

Measure content performance. Develop and improve products. List of Partners vendors. Your Money. Personal Finance. Your Practice. Popular Courses. Investing ETFs. Table of Contents Expand. The Volatility Index. The Bottom Line. Key Takeaways The VIX, or the volatility index, is a standardized measure of market volatility and often used to track investor fear. Article Sources. Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts.

We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy. Ready to Take the Next Step? The offers that appear in this table are from partnerships from which Investopedia receives compensation.

This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace. Related Articles. Partner Links. During periods of high volatility it trades lower, trying to price a return that will lower the volatility. It functions in the same way with a negative roll yield, and has the same maturation date.

This means it must be monitored daily, as it bases its return on a single day benchmark. Monitor this investment daily! Inverse ETFs that are held for more than a day can lead to big losses. This fund seeks to track 1. These are one-to-two month futures. This also needs to be closely monitored as it bases its return on a single day benchmark as well. Sorry to be so blunt! You want to invest in VIX? Then start with those. VIX is a measure of how people feel about the state of the market.

Many of these funds need to be monitored daily, and are best for experienced investors familiar with the risk of trading them. What do you think? Will you start trading VIX funds? Or are they too risky for your investment style? Grow Rich Investing Money. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment.

As satisfying as this was, I still felt that something was missing. As exchange-traded products, you can buy and sell these securities like stocks, greatly simplifying your VIX investing strategy. Before investing in any VIX exchange-traded products, you should understand some of the issues that can come with them. ETNs in particular can be less liquid and more difficult to trade as well as may carry higher fees.

Market professionals rely on a wide variety of data sources and tools to stay on top of the market. The VIX is one the main indicators for understanding when the market is possibly headed for a big move up or down or when it may be ready to quiet down after a period of volatility.

Experts understand what the VIX is telling them through the lens of mean reversion. In finance, mean reversion is a key principle that suggests asset prices generally remain close to their long-term averages.

If prices gain a great deal very quickly, or fall very far, very rapidly, the principle of mean reversion suggests they should snap back to their long-term average before long.

When the VIX moves lower, investors may view this as a sign the index is reverting to the mean, with the period of greater volatility soon to end. As an investor, if you see the VIX rising it could be a sign of volatility ahead. You might consider shifting some of your portfolio to assets thought to be less risky, like bonds or money market funds. Alternatively, you could adjust your asset allocation to cash in recent gains and set aside funds during a down market.

On the other hand, during times when the VIX is falling, indicating the possibility of more stability to come in the stock market, it might make more sense to focus on individual stocks or other riskier assets that might fare well during times of growth. Miranda Marquit has been covering personal finance, investing and business topics for almost 15 years.

Miranda is completing her MBA and lives in Idaho, where she enjoys spending time with her son playing board games, travel and the outdoors. With two decades of business and finance journalism experience, Ben has covered breaking market news, written on equity markets for Investopedia, and edited personal finance content for Bankrate and LendingTree.

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