Both XIV and SVXY tracks the daily inverse percentage of VXX. The deviation of the these two tickers are almost negligible. Compared to XIV, SVXY has the following pro and cons.
Pros:
- SVXY is a ETF while XIV is ETN. ETN is actually issued debt. The price of ETN is affected by the credit rating of its issuer. If the issuer goes bankrupt, ETN price will go to zero. Therefore, ETF is generally safer than ETN.
- The prices of SVXY and XIV are 64.53 and 8.06 as of Jan 20, 2012, respectively. The higher price of SVXY means less trading cost at IB.
- More importantly, the tax rates for SVXY and VIXY are 23% for both short-term and long-term investments. In contrast, the tax rates for VXX and XIV are 35% and 15% for long-term and short-term investments, respectively.
Cons:
- SVXY is not as liquid as XIV. The average daily volume for SVXY and XIV are 65,358 and 7,307,020, respectively. Considering their price, the daily changed amount of SVXY is only 7% of XIV. The probably means wider spreads between bid and ask prices.
努力！奋斗！ 