The "daily Call" From Option Alpha: Options Trading | Stock Options | Stock Trading | Trading Online

Hey everyone. This is Kirk here again from Option Alpha and welcome back to the daily call. Today, we’re going to be answering the question, “What’s the difference between VIX which is the Vix and VXX?” The first thing you have to understand is that these two things are not the same. I think actually, a lot of people interchangeably use VIX or VXX when they mean one or the other, but not the same. Now, they are different products, but they use the different, I guess underlying to track and trade. The first one is the Vix. The Vix in and of itself is not something that you can necessarily trade directly. You can trade options on it, you can trade futures on the Vix, but you can’t trade VIX itself. You can’t buy VIX in the open market. And what the Vix does is just simply track implied volatility on a 30-day basis for the S&P 500. You could think of it as the implied volatility reading or chart of the S&P 500. Now, the difference here is that VXX in an ETN. And so, VXX, you can trade, you can short, you