WESTPORT, Conn.--(BUSINESS WIRE)--REX Shares, LLC (REX) today announced its short volatility fund, the REX VolMAXX Short VIX Futures Strategy Fund was the best performing ETF in the U.S., excluding leveraged products, for calendar year 2017 according to Bloomberg data. Over the course of the year, VMIN turned in a total return of +190.57%*.
Launched in 2016, VMIN provides short exposure to movements in the VIX Index. As the first ETF of its kind, VMIN seeks to track movements that most accurately reflect the VIX Index by maintaining a weighted average time to expiry of its investments in VIX contracts of less than one month. Even though the VIX Index1 performance over the period was only down -21.37% in 2017, fund investors generally benefitted from rolling short VIX futures contracts that led to outperformance.
“Since the launch of VMIN in May of 2016, we believe the market environment has been ideal for short volatility strategies,” said Greg King, founder and CEO of REX Shares. “Through the first three weeks of 2018 the VIX has had an average closing level of 10.30, and we expect the debate to continue as to whether and when things will change.”
Laura Morrison, Senior Vice President, Global Head of Exchange-Traded Products at Cboe, said: “As both the home of the Cboe Volatility Index, and the listing venue for VMIN, we couldn’t be more proud of this fund’s continued success and strong uptake among investors of every sort. VMIN absolutely proves the utility of ETPs in packaging investment strategies into accessible products, and we look forward to more innovations from REX in the future.”
During 2017, VMIN maintained a weighted average time to expiration of less than one month at all times. As a result, it experienced a correlation with the VIX Index of -0.93 and a beta to the VIX Index of -0.46. During this period, the S&P 500 VIX Short Term Futures Inverse Daily Index experienced a return of 183.71%, a correlation with the VIX Index of -0.89 and a beta to the VIX Index of -0.38. In general, the shorter weighted average time to expiration of VMIN contributed to a higher inverse beta and correlation to the VIX Index, which led to a stronger positive performance during a period that experienced relatively low levels of volatility.
For more information visit www.volmaxx.com. Follow on Twitter: @REXShares
Headquartered in Westport, Connecticut, REX Shares sponsors ETFs that follow alternative investment strategies in commodities, VIX, and cryptocurrencies. REX was founded by Greg King, creator of over 85 exchange-traded products for Barclays, Credit Suisse, Global X, and VelocityShares.
*Performance is based on the net asset value returns from December 31, 2016 to December 31, 2017. The market price return for VMIN is 193.59% for the same period. The annualized net asset value return from inception (5/2/2016) to December 31, 2017 was 171.84%, and the market price return was 173.38% for the same period. The fund’s expense ratio is 3.13%. Performance quoted represents past performance from the fund administrator, SEI, which is no guarantee of future results. Investment return and principal value will fluctuate so you may have a gain or loss when shares are sold. Current performance may be higher or lower than that quoted. The high short-term performance should be viewed as a consequence of the high degree of risk associated with VMIN and may not be sustainable in the future. VMIN’s investments can be highly volatile and may experience large losses. The fund should be utilized only by short term investors who (a) understand the risks associated with seeking short term investment exposure, (b) are willing to assume a high degree of risk, (c) understand the risks of shorting and (d) intend to actively monitor and manage their investments in the fund. Short term performance is not a good indication of the fund’s future performance, and an investment should not be made based solely on returns. Shares are bought and sold at market prices and not individually redeemed from the fund. Brokerage commissions will reduce returns. NAV is calculated using prices as of 4:15 PM Eastern Time. The market price is the Mid-Point between the Bid and the Ask price as of the close of the exchange. Market price returns do not represent the returns an investor would receive if shares were traded at other times.
1 The Chicago Board Options Exchange, Incorporated (“CBOE”) Volatility Index (the “VIX”) seeks to measure the market’s current expectation of 30-day volatility of the S&P 500® Index, as reflected by the prices of near-term S&P 500® Index options.
Carefully consider the Funds’ investment objectives, risk factors, charges and expenses before investing. This and additional information can be found in the Funds’ prospectus, which may be obtained by calling 1-844-REX-1414. Read the prospectus carefully before investing.
The Funds should be utilized only by investors who (a) understand the risks associated with seeking short term investment exposure, (b) are willing to assume a high degree of risk, (c) understand the risks of shorting and (d) intend to actively monitor and manage their investments in the Funds.
Investing involves risk, including the possible loss of principal. These Funds are actively managed and there are no guarantees investments selected and strategies employed will achieve the intended results. Active management may also increase transaction costs. The Funds expect to invest primarily in VIX futures contracts, which are considered commodities. VMAX and VMIN are not benchmarked to the VIX Index, which is calculated based on the prices of put and call options on the S&P 500® Index. As such, both Funds can be expected to perform very differently from the VIX Index. Although VMIN seeks to provide “short” exposure, the Fund does not promise or seek to provide any specific negative multiple of the performance of the VIX Index or VIX Futures Contracts over any specified period of time.
The use of derivatives, such as futures contracts, swap agreements and options, presents risks different from, and possibly greater than, the risks associated with investing directly in traditional securities. Changes in the value of a derivative may not correlate perfectly with the underlying security, asset, rate or index. Gains or losses in a derivative may be magnified and may be much greater than the derivative’s original cost. The derivatives may not always be liquid. This could have a negative effect on the Funds’ ability to achieve its investment objective and may result in losses.
The Funds will invest in exchange-traded notes and exchange-traded funds, and will be subject to the risks associated with such vehicles. The Funds’ performance will be directly related to the performance of those investments.
The return for investors that invest in VMIN for periods other than a full trading day will differ from VMIN’s stated daily inverse investment objective. During periods of high volatility, VMIN may not perform as expected and may have losses when an investor may have expected gains if VMIN is held for a period that is different than one trading day.
The Funds are non-diversified. Indexes are unmanaged and one cannot invest directly in an index.
Exchange Traded Concepts, LLC serves as the investment advisor and Vident Financial serves as sub advisor to the fund. The Funds are distributed by SEI Investments Distribution Co. (One Freedom Valley Dr., Oaks, PA 19456), which is not affiliated with Exchange Traded Concepts, LLC or any of its affiliates.