Geopolitical uncertainty continues to shape market dynamics, with recent tariff delays on Mexico and Canada offering only temporary relief. Despite a more neutral gamma profile for the S&P 500, implied volatility remains elevated, reflecting ongoing investor apprehension amid policy uncertainty under the Trump administration. The VIX, a key measure of market volatility, has decreased as traders focus on political developments rather than traditional economic indicators. This shift in focus is driven by the Fed's patient stance and the looming EU tariff announcement, which have kept risk sentiment in check and limited aggressive equity positioning.
The VS TR -1x Short VIX Futures ETF (SVIX) has responded to these market conditions, rising 1.93% to $25.41 as of 11:00 AM on Tuesday, February 4.