The Case for Selling Apple Puts
Lately it seems as if everyone with a keyboard is aflutter about the two weeks of selling in Apple (AAPL). I was about to label this a correction, but really, which is more correct: AAPL at 644 or AAPL at 582? How about the Topeka Capital Markets analy...
Stocks and Economic Data on Upswing Despite Disappointing Manufacturing and Housing Numbers
In many respects, today is a microcosm of the first 4 ½ months of 2012: industrial production and housing starts data fell short of expectations, yet stocks pushed higher regardless. This is the third year I have been periodically publishing some pro...
Chart of the Week: Don’t Blame China
Last week’s financial headlines were dominated by Spain and China. In the case of Spain, this was largely due to increased borrowing by Spanish banks from the European Central Bank. For China the culprit was Q1 GDP growth of only 8.1%, which was down...
Banco Santander Finally Tackles One Huge Problem: Its Ticker
With Spain firmly in the crosshairs of Act N+1 of the European sovereign debt crisis, it was with great comfort that I noted yesterday’s announcement from Spain’s largest and most important bank, Banco Santander (STD), that the company was finally ...
Buying SVXY Calls when the VIX Spikes
Based upon some of the emails I have received this week, it appears that a number of readers have been focused on buying some of the inverse VIX ETPs, notably XIV and SVXY, when they saw the VIX spike. Some have preferred shorting VXX, TVIX and UVXY, b...
Performance of VIX ETP Hedges in Current Selloff
It was only a week ago that I discussed the performance of 31 VIX and volatility-based exchange-traded products in VIX ETP Returns for Q1 2012 and barely a month ago that I examined in some detail the workings of two VIX ETPs, VQT and XVZ, in Dynamic V...
E-Mini S&P 500 Futures Fall 1.4% on Disappointing Nonfarm Payrolls
In case you missed it earlier this morning, after a nonfarm payrolls report that indicated 120,000 jobs were created in March, approximately 80,000 short of consensus expectations, equity futures fell approximately 1.4%, with the E-mini S&P 500 fut...
VIX Premium to SPX Historical Volatility at Record High in Q1
Back in September 2010, in VIX and Historical Volatility Settling Back into Normal Range, I presented an earlier version of the chart below to explain that in spite of the protestations of the time, the relationship between the VIX and historical volat...
VIX ETP Returns for Q1 2012
Back in my consulting days, I convinced myself that there were rare instances when an ugly chart crammed full of data should take precedence over a clean and simple graphic that focused on the key takeaways. For my purposes at least, the graphic below,...
TVIX Premium to Indicative Value Creeping Back Up…
If you thought the TVIX (VelocityShares Daily 2x VIX Short-Term ETN) story was behind us, you might want to think again. No, I am not talking about the recent news that FINRA is “looking at the events and trading” associated with TVIX and more gen...
EVALS Update and a Look Under the Hood
I have fielded so many questions about EVALS that I finally decided to put up a summary post that discusses various aspects of the mechanics of the EVALS model portfolio as well as some performance data. In EVALS Q1 2012 Update, I address such issues a...
Why Not Point Hedges?
When most people think of hedges, they think in broad terms like hedging an entire long equity portfolio with SPX/SPY puts or VIX calls or some similar product. The thinking is typically that it is better to have broad-based protection against a bear m...
