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REDDIT

Understanding VIXM

B
Mar 3, 2025 · 19:47

I've got a small holding of VIXM I bought right after the US election. I'm having trouble finding details about exactly how this ETF functions. The prospectus describes a rolling basket of options with a 5 month average and describes maturing options being rolled into a next traunch of 5 month VIX options.
Other than lots of warnings that this ticker is highly volatile and involves significant risk of loss, I don't see much else.

How does this ETF actually maintain a value? It seems like it should eventually decay to zero as options mature while underwater?

Silly question perhaps, but I'm just trying to better understand how the money flows with this ETF.