Guest Posted April 28, 2013 Posted April 28, 2013 Not sure if you guys looked into this yet, but i came across an interesting article on SA. http://seekingalpha.com/article/1040231-black-swan-insurance-that-might-pay-off-even-if-there-is-no-crash Quote
Guest Posted April 28, 2013 Posted April 28, 2013 (edited) It is a directional trade, and if the direction is wrong he loses $2625. In this case he won. VIX closed at 16.69 and his profit was about $2700 for a$2625 investment. If the VIX had finished under 15 the position was a loser. For comparison, try this one:http://seekingalpha.com/article/1210461-insure-your-portfolio-while-it-s-cheap-another-pullback-could-be-ugly-and-deep Take a look especially at the author's comments. The position is meant to be rolled so it is always at least 60 days out. Profits from a volatility spike and costs not much. Edited April 28, 2013 by lc_match-aka-Bill Quote
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