VIX Distortions Abound As BofA Notes 'Volmageddon'-Triggering ETPs Are On The Rise Again

Historically VIX exchange-traded-products (ETPs) were a force to be reckoned with and clearly distorted the VIX derivatives market at the time – a phenomenon most evident on 05-Feb-18, now famously known as “Volmageddon”, when in a single day 1m VIX futures roughly doubled, causing the inverse ETP complex to get wiped out.

In the years after Feb18, the short VIX products remained a shadow of their former self