Replies to post #926 on iPath S&P 500 VIX Short-Term Futures ETN (VXX)

[risk on]

Dr C, I have a relevant question here that's really perplexing....

See the VXX chart below, and note the decline in price ( split adjusted) from $7,200 to $30 apx. since its creation



Now see the put options chain for 564 days out ( max expir)




THE QUESTION IS, if VXX is clearly destined to decline, as proven through chart history ( massive % declines) then why in the world wouldn't the price for $5, $10, $15, etc PUTS ( only several 100% decline at most) be through the roof ? In fact, the price actually declined on a couple lanes today. Just seems so obvious to load those options given VXX is destined to fail.

[risk on]

Doc C, would you agree that VIX is in some respect a measure of put options vs calls in an overall sense. Meaning that it can be a leading indicator of overall market direction?