BY ANDREW GIOVINAZZI
January 2, 2024
If some of my volatility jargon is vexing, head to the glossary.
Hello All,
So take a walk back down memory lane before the COVID Pandemic, before Volmaggedon and various other Fed induced market catastrophes. Back when things were simple. Back when VIX was in the 8 handle for a brief period of time. That was 8.99.
10 year VIX chart
Will it happen again and change your trading?
Donald J Trump was the lowest Vol President in a decade
Until COVID of course, but that is another topic.
Congress cut taxes, US Gov revenue grew and stocks ran. The problem of course is then Congress kept spending and rates started rising by the end of 2018. It was a whole year of very low 30 day volatility measured by VIX prior to that. All of the short volatility products made crazy highs. The -1x Short VIX Futures ETF (Ticker: SVIX) could easily double under that scenario and we are holding that in our SVIX strategy.
2 Year SVIX chart
The Dept of Government Efficiency (D.O.G.E) has to make headway for that to happen but it would set up a similar trajectory for volatility. Keep an eye on it for 2025.
Andrew Giovinazzi
30-Year Trading Pro
See what's hot at option pit
CAPITOL GAINS: SMR Aug16 7 call closed for a 150% gain
DELTA STRIKE: VLY Mar15 8 puts closed for a 88% gain
PFE May17 26 calls closed for a 66% win
OP MENTORING: SPY Mar22/19 510 put calendars and 520 calls for 6.4% gain
OPTION SHOPPER: ERX Mar28 65 calls closed for a 90% gain