2 November 2016: Fear

fear-ghostNormally, a sharp rise of the so-called fear index comes with a sharp drop of the general stock indices. But the previous days, the VIX has climbed more than 40%, yet the S&P 500 has lost less than 2 percent during that period. This could mean two things: more volatility to come or buyers of volatility options on which the VIX is based have been a bit too pessimistic. Option traders are taking their measures in case one of their worst nightmares comes true: the election of Donald Trump as the 45th President of the United States. How unlikely this election might seem, these traders think that it is better to be safe than sorry.

white-chapel-logo-smallThe US Presidential elections keep adding to the feeling of uncertainty among investors. Alle major US indices made substantial losses yesterday and volatility was once more on the rise: the VIX gained almost 9% and our UVXY ETFs added almost 6%. Return for the year passed the 300% mark and stands at 300.6%. Return for the quarter is above 30%.

Trading signal: as a result of a change of momentum, White Chapel gave a trading signal at the end of Tuesday’s session: an “I” (inverse) signal. As a result of that, we sold our volatile positions (UVXY ETFs @ $17.70) this morning and bought inverse ETNs (XIV ETNs @ $35.67).

Accumulated capital at close of previous trading day

Return since start

Return this year

Return this quarter





Our initial capital was $10,000 at 1 January 2016. Our average Annual Return is 435%.

RS_v05-smallLast weekend, The Netherlands put an end to daylight saving time (summer time). We are now back to standard time, after the clock has been shifted back one hour. On Tuesday, commuters were caught off guard by the drizzling rain and the early darkness. On their second working day of the week, they were confronted with the busiest evening rush hour of the year. They stared at the raindrops on their windshield, and listened to the monotonous sound of the windshield wipers. And the overly cheerful voice of a perky newscaster told them that they were standing still.
These are the moments that last summer’s holiday feels like a vague distant memory.