Three Top Ways to Trade Excessive Volatility

Markets have become wildly volatile.

But that’s to be expected with fears of an economic slowdown, nearing elections, and a poor jobs report for August. In fact, as noted by The New York Times:

“The labor market appears to have shifted into a lower gear, reinforcing concerns that businesses have little appetite to hire as interest rates weigh on investment and the path of consumer demand remains uncertain. Employers added 142,000 jobs in August on a seasonally adjusted basis, the Bureau of Labor Statistics reported on Friday, a weaker-than-expected showing for the second consecutive month. And totals for June and July were revised downward.”

But don’t let that scare you away from the markets. Instead, use the volatility to your advantage. We can do that by simply trading volatility with ETFs such as:

ProShares Ultra VIX Short-Term Futures ETF (SYM: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.

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.

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.

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