The VS TR 2x Long VIX Futures ETF (UVIX) is experiencing upward momentum as the Cboe Volatility Index (VIX) climbed 6.4% to just under 17 in early trading on December 30, 2024. This increase in the VIX, often referred to as Wall Street's "fear gauge," indicates rising market uncertainty. Investors are particularly concerned about the Federal Reserve's cautious approach to interest rate cuts in 2025 due to persistent inflation. This apprehension is affecting high-growth sectors like technology and AI, which have been significant drivers of market gains over the past two years.
Additionally, the India VIX, a measure of expected market volatility in India, rose by 4.79% to 13.87, reflecting similar concerns in international markets. The broader market sentiment is being influenced by a drop in India's forex reserves and a decline in media shares, contributing to a more cautious trading environment. These factors are collectively contributing to heightened volatility expectations, which are positively impacting the UVIX ETF.
The UVIX ETF is up 4.08% in pre-market hours on Monday, December 30, reaching $3.32 as of 7:27 AM ET.