Revisiting The "No Brainer" XIV-SPY Convergence Trade
At the start of September last year, as stocks began to ramp aggressively off the Black Monday crash lows, we unveiled a rather discomforting "decoupling" that suggested strongly "don't believe the hype."
Specifically, on August 30 we said that of all trades out there, the XIV-S&P convergence trade is as close to a "no brainer" as it gets:
XIV - ES: "no brainer" pair trade of the week pic.twitter.com/sAIanK2gMW
— zerohedge (@zerohedge) August 30, 2015
Four months later, and able to remain strongly convicted of the trade, the inverse VIX ETF (XIV) and the S&P 500 ETF (SPY) have recoupled back at the lows from August 24th. We await the recoupling of equity exuberance to credit curmudgeon-ness...
And now - equities have collapsed back to the VIX complex's reality...
Time to exit.
* * *
What next?
Because VIX has a lonmg way to go too!
Trade Accordingly.
(7 votes)
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Here comes the Ramp!! Grab your socks and pull!
*munches on popcorn
PPT to the rescue! Only down 375 as of this!
Die Mr. Yellen, die!
Tol'ja so...
http://www.zerohedge.com/news/2016-01-15/dow-crashes-650-points-bullard-bounce-top#comment-7051188
I can let go of my ankles now?
"PPT powers activate!"
Ramp failure?? I'm at a loss. I'm wandering the streets naked.
Ground control to Major Tom...
The one thing your 3rd chart doesn't show.... HYG has a long, long ways yet to fall. It's going to be like watching a really long, and painful, game of follow the leader.
Yeah -- zoom that chart out, let's really see it....
I see that 3:30 Ramp Capital entered the fray early today.
So predictable and easy, even an HFT machine can do it!
NQ above VWAp and using crude to fuel it. NYMEX close is a mother fucker for shorts.
Yeah, this happens a lot, too.
Efficient, stable, markets.
They are controlling the demo. Unloading their toxic assets and re positioning themselves for the downside along with accumulating real shit like gold and silver.
Here comes trillions of dark QE to the rescue...temporarily...
hi i am from Canada...
spare change anybody? ...please...
cauliflower u don't need , half eaten... please send it to me...
Rent your touque?
Come on Japan, get us green!
The ramp has begun! Time for the Fed and Treasury to throw future debt money into the fire in hopes that they will appease their god molec and he will give them another year of flat markets!
Bullard BUCKS, Bullard BUCKS, Bullard BUCKS.
This bitch is going to sell hard into the close the damage is done,neg feed back lope is on.
Black Tuesday coming now, the last 30 minutes the markets tank hard..
VIX still low looks to complacent, More selling.