Volatility Trades Return to ETP Market as Stock Rout Deepens

(Bloomberg) -- So much for a quiet session in U.S. stock markets.

With the Cboe Volatility Index rising the most in more than a week amid an equity-market rout, three of Monday’s 10 most-traded exchange-traded products bet on higher volatility, data compiled by Bloomberg show.

The VelocityShares Daily 2x VIX Short Term ETN, ticker TVIX, was the third-most traded ETP of the day, lagging only State Street Corp.’s SPY and the PowerShares QQQ. The iPath S&P 500 VIX Short-Term Futures ETN (VXX) was No. 6, while the ProShares Ultra VIX Short-Term Futures (UVXY) -- which seeks to return 1.5 times a volatility gauge -- saw the seventh-largest volume.

While volumes remain depressed with much of Europe out on holiday, U.S. traders are clearly back at their desks and mean business.

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