One of the best trades in the stock market this year has been betting on lower volatility, and by one indicator, it?s going to stay that way.
Short sellers are abandoning an exchange-traded fund that becomes more valuable during times of market tranquility after it soared 24 percent this year. Bearish bets on the fund, known as the VelocityShares Daily Inverse VIX (XIV) Short-Term ETN, make up 0.2 percent of outstanding shares, a record low, compared with 19 percent in June, according to data compiled by Markit Ltd.
?There just aren?t a lot of catalysts out there that could cause the markets to get derailed,? Frederick, managing director of trading and derivatives at Charles Schwab, said by phone from Austin, Texas. ?That?s the consensus perspective among the institutions out there right now.?
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