Why You Should Stay Away From Volatility ETFs

Larry Berman today explained why investors should stay away from volatility ETFs, specially vehicles like the TVIX.

The reason is that they invest in futures, and as pretty much all of them, they are money-losing machines when there is contango In the case of TVIX, that is clearly the case as investors expect volatility to increase in the future, thus, the ETF has to lower (lose) the number of contracts every month. These ETFs should really be banned.

Watch

Note: You may receive technical analysis and alerts of TVIX sent automatically to you by entering the symbols in the Technical Trend Analysis Tool, (powered by INO).