Investors who want to bet on an increase in volatility in the near term should look to the S&P 500 VIX Short Term Futures ETF (TSX:HUV). This ETF utilizes prices of the next two near-term VIX futures contracts to replicate a position that rolls the nearest month VIX futures to the next month on a daily basis in fractional amounts.
Shares of this ETF have climbed 18% year-over-year at the time of this writing. The ETF was up 1% in mid-afternoon trading today.
The Buffett indicator has jumped to a record high in the middle of February. Investors should be very cautious in this environment. Those who want to hedge against an overheated market should look to stash this ETF in their portfolios in the late winter.