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Bailey McCann, Opalesque New York:

So, volatility is back. The VIX spiked 118% on Monday as the market extended its losses to a new record. The move roiled investors in after-hours trading as $XIV and $SVXY, the two most popular short-volatility products, hit new lows triggering worries about termination. Some traders also raised questions about the losses in short-volatility products adding to an overall correction.

As of late Monday night, Credit Suisse which holds the note on XIV, had yet to comment on the fate of the ETN, which can liquidate if it loses more than 80% of its value. $SVXY, an ETF, is poised to open with the market tomorrow despite its heavily diminished status. Even without an official termination, some $3 billion in value went up in smoke during after-hours trading yesterday, according to estimates from Business Insider. Before Monday's drop, $XIV and $SVXY had a combined value of just over $4 billion. The losses mark a sharp reversal from even last Thursday when investors piled $520 million into $XIV only to see the market drop and volatility start to rise on Friday.

One ETN is already gone for good, however, Bloomberg is reporting that Nomura has liquidated the Next Notes S&P 500 VIX Short-Term Futures Inverse Daily Excess Return Index ETN.

Smart, ......................

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