Volatility is one of the most misunderstood — and most powerful — forces in the options market. In this webinar, we go far beyond the basic definition of $VIX and examine how volatility derivatives actually behave in real market conditions. From understanding the mechanics of $VIX futures and term structure, to implementing “The Big (Volatility) Short,” to using $VIX/SPY hedged spreads during extreme discounts, this session focuses on practical strategy. If you trade options, manage portfolio risk, or use volatility products like VXX, SVXY, or $VIX options, understanding how these instruments are constructed — and when they diverge — is essential.
The full webinar video is available above for paid subscribers.
Webinar Outline
1. Foundations: Implied Volatility & The $VIX
What implied volatility really represents
Why rising IV makes options expensive
The evolution of $VIX (from $OEX-based to modern $SPX strip methodology)
How $VIX is calculated and why it matters
2. Using $VIX as a Market Tool
The inverse relationship between volatility and stocks
Defining volatility “trends” (20-day vs. 200-day moving averages)
The $VIX Spike Peak Buy Signal
Historical examples: 2008, 2018, 2020
3. Trading Volatility Directly
Why you can’t trade $VIX itself
$VIX futures: contract specs, expiration, settlement
Weekly futures and their importance
Why futures don’t always move like spot $VIX
4. Understanding Term Structure
Why term structure slopes upward in bull markets
Why it inverts in bear markets
What media often gets wrong
Term structure changes as a market signal
5. Term Structure Trades (High Leverage Strategies)
Calendar spreads using $VIX futures
Bullish vs. bearish positioning
Margin advantages
Risk management and stop discipline
Hedging with SPY options
6. ETNs & ETFs: VXX, SVXY, UVXY & More
How VXX actually works (daily roll mechanics)
Why VXX decays in contango
The “Big Volatility Short” strategy
Why inverse products (like XIV) can implode
Risk factors in leveraged and inverse volatility products
7. $VIX Options: Important Differences
Why $VIX options are priced off futures
Settlement mechanics
Skew differences vs. $SPX options
Why $VIX calendars can carry unexpected risk
8. Portfolio Protection Using Volatility
Buying near-term OTM $VIX calls
Hedging naked put exposure
Position sizing guidelines
9. The $VIX/SPY Hedged Strategy
Trading volatility discounts and premiums
When $VIX futures are “out of line”
Buy 2 VIX calls / Buy 1 SPY call structure
Managing deltas
Rolling the winning side
Exit criteria when the “edge” disappears
10. What Can Go Wrong
Divergences between spot $VIX and futures
Implied volatility distortions
Failure to adjust hedges
Inverse product collapse risk
Closing Principles
Always use a model
Trade all markets
Use follow-up strategies
Trade within your personal philosophy
