ProShares Ultra VIX Short-Term Futures ETF

UVXY

Market cap $737M

Top Performing Leveraged/Inverse ETFs Last Week These were last week's top performing leveraged and inverse ETFs. Note that because of leverage, these kinds of funds can move quickly.

The artificial intelligence sector is showing critical warning signs that suggest a significant correction may be approaching. Recent market analysis reveals that AI stocks, particularly the “Magnificent Seven,” have been making lower highs since December 2024, diverging from broader market performance – a pattern that historically precedes major corrections.

I use VIX-based ETFs like VIXY and UVXY as surrogates for put options to benefit from rising volatility. SVXY acts like a call option for me, as it gains value when volatility drops and stocks typically rise. Leveraged ETFs such as TQQQ (long) and SQQQ (short) are key trading tools, offering amplified exposure to market moves.

Top Performing Leveraged/Inverse ETFs Last Week These were last week's top performing leveraged and inverse ETFs. Note that because of leverage, these kinds of funds can move quickly.

A volatility premium has opened up, which we expect to unwind in due course. Macro variables are on a knife's edge, and docile put buying has dragged the VIX into a lagged territory. We anticipate reversion to occur. The ProShares Ultra VIX Short-Term Futures ETF has suffered serious losses recently, yet, we think it's bound to benefit from front month volatility being seemingly underpriced.

The ProShares Ultra VIX Short-Term Futures ETF owns one and two-month futures on the VIX, the volatility index, aiming to be leveraged 1.5x. Historically, the VIX and leveraged exposure to it has proven profitable hedges during sudden market downturns. This makes UVXY an interesting potential tactical position. This article explores UVXY educationally, discussing its construction, use cases, and performance against peers.

Top Performing Leveraged/Inverse ETFs Last Week These were last week's top performing leveraged and inverse ETFs. Note that because of leverage, these kinds of funds can move quickly.

Volatility ETFs are on the rise as Trump's renewed tariff threats sent the VIX fear gauge soaring 29.3% last week.

ProShares Ultra VIX Short-Term Futures ETF offers an opportunity for tactical risk-seeking investors, portfolio hedgers, and traders to act on front-month volatility. We think front-month volatility is underpriced. We calculated the 3-month SMA higher than longer-run averages, which is likely justified given a string of macro and political shocks. Unfortunately, we see the baseline VIX being higher for longer given the unstable political, fiscal, and economic cycle environments. On the plus side, inefficient VIX term structures could occur.

The Cboe Volatility Index surged to over 52 points on April 8, 2025, the highest since March 2020, indicating extreme market volatility. ProShares Ultra VIX Short-Term Futures ETF and iPath Series B S&P 500 VIX Short-Term Futures ETN are effective hedging tools in volatile markets. Selling calls on UVXY and VXX can maintain hedging positions in the short term until market volatility subsides, despite potential mean-reversion of the VIX in the near future.