Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Volatility Strikes With A Vengeance

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The VXX ranks amongst the top most hated ETFs of all time and it has retained its bottom of the barrel reputation since its introduction in 2009. It is despised for many reasons but mainly because it’s a terrible investment on a long term basis due to its factory installed value leakage. This is courtesy of the fact that it’s tied to the value of the SPVXSTR index, which in turn tracks a pair of VIX futures contracts.

Staying in sync with the SPVXSTR and by extension a pair of monthly changing VIX futures contracts creates small but constant value decay due to roll or contango loss as the front month VX contract is priced lower than its following month around 85% of the time.


I Glanced at My Watch

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It’s Fed Day, folks. You know what that means. Sitting around anxiously as we await Powell say the exact same things the Fed has said every single time for the past twelve agonizing years:

  1. We have a dual mandate, which is all about helping the little fella;
  2. We follow the data;
  3. It’s not entirely clear that the economy is ready to stand on its own;
  4. So we’re going to keep a really, really close eye on things.
  5. Once we know the market doesn’t need our help, we’ll put our tools away.

Uh-huh. Shove it, J.P.