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VIX Volatility Model - Model switches to BUY on October 21, 2016

Published : October 21 2016 at 9:12 ET

The Volatility Model has switched to a BUY signal. Price of UVXY at time email sent: <opening price> 


If the model was on a SELL signal, first sell any SELL signal related ETFs such as XIV, then buy ETFs such as VXX, VXZ, UVXY, etc (see list below).

If you decide to buy UVXY when it is, say, 1% above or below the price at the time the email was sent, this would be roughly 0.5% if you are buying a 1x ETF such as VXX.

For purposes of record keeping, UVXY will be used as the benchmark on BUY signals. This means gains and losses are twice that of a 1x ETF such as VXX. For those who are more risk averse, buying VXY (0.5x) or VXX (1x) are better choices. Alternatively, one can position a smaller size to reduce risk.


When the model switches to a BUY signal, buy ETFs such as VXZ (0.5x), VIXY (1x), VXX (1x), TVIX (2X), UVXY (2X). The model thus believes the general markets will move lower thus volatility will increase.

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