Summary

• Rising tensions in the Middle East have renewed investor interest in volatility ETFs, which are designed to increase in value as expected market volatility rises.
• VIX-linked ETFs track short-term futures on the CBOE Volatility Index, which measures expected equity market volatility derived from S&P 500 options.
• The right framework for evaluating IVOL is not whether it outperformed the S&P 500 in a given year, but whether it fulfilled its intended role within the broader portfolio.

Rising tensions in the Middle East have renewed investor interest in volatility ETFs, which are designed to increase in value as expected market volatility rises. While VIX-linked ETFs are well known, they focus on equities and overlook fixed-income

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