Stock Market Volatility Jumps Following Fed Monthly Minutes: This ETF Offers 1.5X Leverage
Portfolio Pulse from Melanie Schaffer
Stock market volatility increased on Thursday due to major stock indices breaking down through the 50-day moving average. The Convexity Daily 1.5x SPIKES Futures ETF (SPKY) rose slightly in response to the bearish movement across stocks. SPKY is a 1.5x leveraged fund that follows the SPIKES Futures Short-Term Index, similar to the ProShares Ultra VIX Short Term Futures ETF (UVXY). The Federal Reserve’s monthly minutes revealed further monetary tightening could be on the horizon, which could add further downside pressure to the stock market.
August 17, 2023 | 4:56 pm
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POSITIVE IMPACT
The Convexity Daily 1.5x SPIKES Futures ETF (SPKY) rose slightly in response to the bearish movement across stocks. It is a 1.5x leveraged fund that follows the SPIKES Futures Short-Term Index. The ETF could continue to rise if volatility continues to increase.
The SPKY ETF is directly linked to market volatility. As the market volatility increases, the ETF's value is likely to rise. The Federal Reserve's hint at further monetary tightening could lead to increased volatility, potentially benefiting the ETF.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100
POSITIVE IMPACT
The ProShares Ultra VIX Short Term Futures ETF (UVXY) tracks the S&P 500 VIX Short-Term Futures Index, similar to SPKY. It could also be impacted by the increased market volatility.
The UVXY ETF, like SPKY, is linked to market volatility. As such, it could also see its value rise if market volatility continues to increase.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 50