How does one go about trading on an anticipated rise in volatility (VIX)? I've dabbled with VIXY a bit, but it looks like contango really eats that up over more than a few weeks/months.
Basically, I'd like to bet (yes, I'm gambling here) that VIX will be significantly higher at some point in the next 6 months. What's the most efficient way of doing this?
Thanks,
amp
Trading Volatility?
Moderator: Global Moderator
Re: Trading Volatility?
Okay, keep in mind I am not an options expert at all 
You could just buy a put and a call that have the same expiration and the same strike price. You have hedged out your price risk, and are left with the volatility component. You could repeat this process for mutiple strike prices and multiple expiration dates... perhaps on SPY.
I am shooting from the hip, but I think this will get what you are after.
You could just buy a put and a call that have the same expiration and the same strike price. You have hedged out your price risk, and are left with the volatility component. You could repeat this process for mutiple strike prices and multiple expiration dates... perhaps on SPY.
I am shooting from the hip, but I think this will get what you are after.
everything comes from somewhere and everything goes somewhere
Re: Trading Volatility?
You still have time decay to deal with in that options scenario.