The Money Tree

Safely Generating Income in Retirement

New NP Trade – VXX

Posted by mounddweller on February 29, 2012

Fellow Traders,

I am sticking my big toe into the water and trading NPs on VXX.  The VIX is very low right now and a lot of market indicators are flashing overbought.  Thus, I think we could see increased volatility in the near future.  Increased volatility will drive both the VIX and its proxy VXX higher.  Now, in my opinion is a good time to sell puts on this ETN. Here’s the trade I just made:

Action Quantity                 Symbol                        Unit Price             Principal Amount

Sold           5          VXX 03/17/2012 22.00 P         $0.50                         $250.00

The most recent low for VXX is $23.67.  My strike price of $22 is well under this low.




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