Markets have become wildly volatile thanks to the Federal Reserve.
After cutting rates by another quarter point, the central bank said it would slow cuts moving
forward. Unfortunately, markets didn’t like that, plummeting more than 1,100 points.
“Traders are now expecting the Federal Reserve to deliver just one or maybe two cuts to
interest rates next year, according to data from CME Group. A month ago, the majority saw at
least two cuts in 2025 as a safe bet. Wall Street loves lower interest rates because they give the
economy a boost and goose prices for investments, but they can also provide fuel for inflation,”
as reported by CBS News.
While markets are pulling back, don’t let it chase you from the market.
Instead, use the ridiculous market fear as an opportunity to trade the Volatility Index with
exchange-traded funds (ETFs), such as:
ProShares Ultra VIX Short-Term Futures ETF (UVXY) — The ETF was designed to match two
times (2x) the daily performance of the S&P 500 VIX Short-Term Futures Index. When the VIX
pops, the UVXY typically follows. Over the last few days, the UVXY ETF ran from a low of about
$18.36 to a recent high of $28.77.
iPath S&P 500 VIX Short-Term Futures (SYM: VXX) — The VXX ETN provides exposure to the S&P 500
VIX Short-Term Futures Index. Over the last few days, the VXX ETF ran from a low of $41.38 to a
recent high of $56.14.
ProShares VIX Short-Term Futures ETF (SYM: VIXY) — ProShares VIX Short-Term Futures ETF provides
long exposure to the S&P 500 VIX Short-Term Futures Index, which measures the returns of a
portfolio of monthly VIX futures contracts with a weighted average of one month to expiration.
Over the last few days, the VIXY ETF ran from about $42.50 to $55.31.
