The XIV ETN plunged by about 85% in after hours trading
It's the thing that's on every person's lips in Wall Street at the moment. Just look at that chart.
Adam and Eamonn covered the news as it happened here:
- The XIV is going to be the first big ETF blowup and Credit Suisse is going to be hit hard
- Could this be why the XIV crashed? It's only worth $4.22
- XIV, SVXY collapse in after hours - not reflected in forex moves
- No one knows what's happening in XIV and it's causing a panic
- Something incredible is happening in the short-volatility ETF XIV and Jim Cramer is having a meltdown
According to a tweet by CNBC reporter, Leslie Picker, Credit Suisse - who owned more than 1/3 of XIV ETNs as at 30 September - are saying that the drop has "no material impact" to the company. And that the movement in the price is "reflective of today's market volatility".
Citing a person with direct knowledge of the matter, she reports that Credit Suisse has yet to make a decision on whether to call an acceleration of the XIV - with the person in question also saying that Credit Suisse is "completely hedged against its exposure".
Last year, we all wanted market volatility to come back and boy, did it return in style indeed.
Anyway, we're still going to have to wait for more official comments on the matter and whether or not we will see a XIV liquidation but for now, the big boys are wanting to play it cool still but I reckon they're pretty much like this:
