There is a very simple and efficient strategy to trade the Volatility 75 Index, which we call the Reversion Strategy.
The strategy is based on the idea that the VIX index gravitates towards 20. Whenever the VIX is below 20, the markets are too calm.
Whenever the VIX is above 20, the markets are agitated. The more it climbs, the more volatile the markets are.
The Volatility 75 Index doesn't stay very elevated for a long time. Nobody wants high volatility on the markets.
This is why central banks try to interfere whenever volatility is too high, in order to bring it down.
Our VIX Reversion strategy indicates to buy the Volatility Index (Long VIX) if the reading is below 17 and take profits in the 19 to 20 range.
If the volatility is high, the strategy recommends to sell the index (Short VIX) if the reading is above 25 and take profits in the 20 to 21 range.
In the case of a sudden volatility spike caused by a black swan event, it is recommended to wait until volatility stabilizes, and then short the VIX.
This is because a black swan event can increase volatility to very high levels, and selling it at 25 can be very risky in such scenarios.
You can safely use any of the following brokers that offer Volatility 75 Index in order to try our strategy, or your own personal strategy:
If you want to learn more about the Volatility 75 Index, we recommend the following pages:
Volatility 75 Index Brokers List
Volatility 75 Index Metatrader 4
Volatility 75 Index Metatrader 5
More information about brokers where you can trade important indices:
Risk Warning: Trading CFD, Forex and any other derivative instruments is very risky and can result in the loss of your entire investment. Please make sure you understand the risks before trading. Never trade money you cannot afford to lose.
