It’s not just Credit Suisse that has an ETN problem, Horizons (Canada) has halted trading and suspended redemptions in its Inverse VIX ETF citing “extreme volatility in VIX- futures market.”
Price for the ETF has collapsed in the last few days…
Horizons ETFs Management (Canada) Inc. (the “Manager “) announced today a trading halt on the units of the Horizons S&P 500 VIX Short-Term Futures™ Daily Inverse ETF, which trades on the Toronto Stock Exchange under the ticker symbol (” HVI “).
HVI seeks daily investment results, before fees, expenses, distributions, brokerage commissions and other transaction costs that endeavour to correspond to the inverse (opposite) of the daily performance of the S&P 500 VIX Short-Term Futures Index™.
The Manager’s decision to halt HVI followed its assessment of the extreme volatility in VIX- futures market that occurred in after-hours market trading yesterday.
The unexpected level of volatility has impaired the trading of the underlying derivatives used by many VIX-related exchange traded products that seek to provide inverse exposure to the S&P 500 VIX Short-Term Futures.
The Manager continues to monitor the trading activities in these underlying derivatives and will advise if any further action on HVI is required in due course. In accordance with HVI’s declaration of trust and subject to any necessary regulatory approvals, the Manager has also temporarily suspended redemptions and new subscriptions until further notice.
Horizons’ HVI Inverse VIX ETF remains well above its NAV, suggesting notable downside if/when it reopens…