The early days of the Trump administration have introduced significant uncertainty, creating a chaotic trading environment as investors navigate potential policy shifts. Speculation about tariffs set to begin on February 1 has heightened market volatility, although equity markets have shown resilience due to the absence of immediate tariff implementations. Despite the potential for increased volatility, the market's current low risk premium around tariff deadlines suggests skepticism about the immediacy or impact of these policies. This environment has led to a slight decrease in the VIX, reflecting a tempered response to the ongoing policy uncertainty.
The ProShares Trust Ultra VIX Short Term Futures ETF (UVXY) experienced a decline, dropping 3.29% to $17.91 at 10:20 AM on Thursday, January 23.