Volatility

High-yield credit volatility has actually declined since the products first came on the scene.

Retail interest in ETPs tied to volatility has dimmed since early February when the S&P 500 tumbled 8.5%.

The closure could signal that remaining retail players are short on patience for neutered products.

Inflows have persisted since the infamous “volpocalypse” in early February.

Clients must still account for gains not incurred through a sale or cash distribution.

Single-day drops are 20% bigger on average than gains, the widest gap in seven decades.

This environment allows advisors to demonstrate their value to clients.

Rising yields coupled with relatively high hidden fees could lead to underwhelming returns.

As the business cycle winds down, advisors should guide them with a steady hand.