Trade Alert - (XIV) August 17, 2017
When John identifies a strategic exit point, he will send you an alert with specific trade information as to what security to sell, when to sell it, and at what price. Most often, it will be to TAKE PROFITS, but, on rare occasions, it will be to exercise a STOP LOSS at a predetermined price to adhere to strict risk management discipline.
Trade Alert - (XIV)- BUY
Buy the Velocity Shares Daily Inverse VIX Short Term ETN (XIV) at $73.05 or best
Opening Trade
8-17-2017
Portfolio weighting: 10%
Number of Shares = 137 shares
You can pay all the way up to $75.00 for this Exchange Traded Note and it still makes sense.
There are no option contracts on the XIV.
I'm betting that sometime in my life, the Volatility Index (VIX) will trade below today's $15.61 high. In fact, I expect it to trade back below $10 within the next few weeks.
If I am right, then there is a potential 35% profit in this position.
If I am wrong, then Armageddon is about to hit and you won't care about your stock position anyway.
You are getting an enormous volatility spike today off of rumors that the president's chief of staff, Gary Cohen from Goldman, and the Federal Reserve Governor, Janet Yellen are about to resign over the Nazi issue.
I know this is absolutely NOT true in Janet's case, and I highly doubt it is true in Cohen's case either. That means that volatility should settle down soon, especially if the shorts cover ahead of the weekend.
There is also a terrorist attack in Barcelona today, which should blow over by tomorrow, once the body count is in.
Remember that tomorrow is an options expiration day, a good time to close out positions.
Also, you get a huge embedded tailwind with the (XIV) with the massive contango in the Volatility Index (VIX), the differential between front month and far month volatility.
After spending the year stuck in in the $9-$15 range, it is nothing less than mind blowing to see it spike up to $15 right now with a minimal recent move in the S&P 500 (SPY).
That has taken the (XIV) down from a nosebleed $97 to a low of $72.50.
This is a not a leveraged ETN, so even if volatility remains heightened for a while, the downside risks will remain small. As an ETN, there is also no expiration date to worry about.
For a detailed description of this 1X short volatility ETN please click here for the issuer's website at http://www.velocitysharesetns.
The learn more about the Volatility Index (VIX), please click here for Volatility Here is Peaking http://members.
Please keep in mind that these are ballpark prices only. There is no telling how much the market can move by the time you get this.
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The best execution can be had by placing your bid for this ET in the middle market and waiting for the market to come to you.
Here are the specific trade you need to execute this position:
Buy (XIV) 137 shares at....................................................$73.05
Net Cost:......................................................................................................$10,
I Bet the Next Big Volatility Move is Down
