ProShares Trust Ultra VIX Short Term Futures ETF (UVXY)

[stingray113]

If someone were long UVXY they would need this to enter backwardation, or at least have very shallow contango in order to profit.

Times of backwardation like today are when UVXY skyrockets. Then, based on mean reversion of the VIX, backwardation quickly slips back down into contango as the front month VIX drags down futures. Contango is what is responsible for the negative roll yield of UVXY.

Bernanke will buff up QE tomorrow, and I see us dropping to at least a VIX:VXV of .95 tomorrow, and likely at least a "bump" in markets off Bernanke's speech.

This afternoon set up a great entry for SVXY/XIV or to short UVXY/VXX/TVIX. I'll be taking off my hedge the second I can book more profits. My volatility portfolio is only down 4% total today, thanks to utilizing proper hedges, even though UVXY jumped 44% from lows.