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One-Way Vol Bets Seen as ‘Fool’s Errand’ by 6,000% Winner

  • Volmageddon blew up short vol strategy, stock calm sinks longs
  • Goldman bets on aimlessness, neither high- nor low-vol regime
A trader works in the Cboe Volatility Index (VIX) pit on the floor of the Cboe Global Markets Inc. building in Chicago, Illinois, U.S., on Wednesday, Feb. 14, 2018. With stocks stepping on the accelerator, the VIX index is following its usual path of tumbling. Though there is news in this move with the index slicing below the 21 to 22 area that marked the VIX's bounce last week.
Photographer: Daniel Acker/Bloomberg

Heads you lose, tails you lose. This year for the first time, trading strategies betting on a jump in equity market volatility and those wagering for calm are both losing.

The reason? February’s “volmageddon” blow out, which did enough to sink short-volatility strategies but not enough to protect long-vol trades from the tranquility that’s enveloped stocks on their way to new peaks.