iPath Series B S&P 500 VIX Mid
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About
iPath Series B S&P 500 VIX Mid (VXZ) is an exchange-traded note that provides exposure to futures contracts on the CBOE Volatility Index, commonly known as the VIX. As an exchange-traded note, it is a debt instrument whose return is tied to an index rather than a fund that directly holds the assets it references. It is known for giving investors exposure to volatility futures positioned in the middle of the maturity range.
A key point about this product is what it actually tracks. It offers exposure to futures contracts of specified maturities on the VIX index, and not direct exposure to the VIX index itself or to its spot level. This means its performance follows the prices of VIX futures contracts rather than the current reading of the volatility index those contracts are based on. Futures can move differently from the underlying index, which is why this difference is significant for anyone considering the note.
The underlying index that the product follows is designed to provide exposure to one or more maturities of futures contracts on the CBOE Volatility Index. Through these futures, the note is built to reflect expectations about volatility in the broad U.S. equity market, which is what the VIX is intended to gauge.
As an exchange-traded note centered on volatility futures, the value of iPath Series B S&P 500 VIX Mid changes with the futures contracts that make up its index. Compared with shorter-dated alternatives, its exposure sits further along the maturity range. The product is structured around tracking these specified futures maturities rather than holding the index or its individual components, and its behavior reflects that focus.