VelocityShares Credit Suisse 3X Long Crude ETN (UWTIF)

[Smittle]

One of the market’s most popular — and volatile — oil plays is going out with a bang

ShawnLanglois
December 6, 2016

The sun is setting on one of Wall Street's most popular oil plays.

The wickedly volatile oil play that emerged as the “YOLO” favorite of millennial traders in recent years is just days from being delisted, and, as one might expect, it’s not going away quietly.

Credit Suisse’s Velocityshares 3x Long Crude ETN UWTI, -1.95% according to Bloomberg data, is seeing the kind of big daily volume numbers reserved for some of the stock market’s biggest names leading up to its delisting date of Dec. 8.


Def unusual: $UWTI/$DWTI 5-day $ volume is as much as Exxon and Chevron with two days till delisting. If it were a stock, it would rank 14th

— Eric Balchunas (@EricBalchunas) 12:26 PM - 6 Dec 2016
UWTI, which will still trade over-the-counter after its delisting, exploded in popularity last year as a means to get leveraged exposure to fluctuations in the oil market. Just last month, it surged about 25% after word of the OPEC deal to cut production sent oil prices flying.

Because of moves like that, UWTI quickly became a favorite of Reddit’s Wall Street Bets, a particularly brash corner of the internet where young traders would compare notes and talk trash about their daily profits and losses. In fact, UWTI ranked fifth in TD Ameritrade’s top 10 list of shares most traded by millennials in 2015; it wasn’t among the top 10 most traded by older investors.

UWTI is not something to be tucked away for the long term, and investors realize that, with the average holding period less than six days, according at Deutsche Bank.

Nowadays, even though the volume remains strong during the countdown to delisting, UWTI is no longer the buzzy play it once was, according to Wall Street Bets creator Jaime Rogozinski.

“It was simply the leveraged synthetic derivative of the month,” he said, adding that members are more focused on Donald Trump and marijuana stocks at the moment. “I’m sure the day that 5x leveraged ETFs come out they’ll be the hot topic as well.”

Perhaps another oil play will emerge to fill the void. Just two weeks after Credit Suisse announced the UWTI delisting, U.S. Commodity Funds filed a preliminary prospectus for a triple-leveraged exchange-traded fund linked to light, sweet crude futures.

http://www.marketwatch.com/story/one-of-the-markets-most-popular-and-volatile-oil-plays-is-going-out-with-a-bang-2016-12-06?siteid=yhoof2