Thursday, June 21, 2012

JPMorgan Alerian MLP Index ETN: The Next TVIX? (AMJ)

Long time readers know I think a question mark in the headline is a sign of weakness/borderline deceitful.
Too many market commentators use them so they can come back and say "Well, I didn't say XYZ"
We try to avoid them in situations where readers might end up plunking some money down. Say what you mean, mean what you say, don't just insinuate etc, etc.

In this case the question is sincere, I've never heard of the JPMorgan Alerian MLP Index ETN and inquiring minds want to know. Since this note offers exposure to midstream energy Master Limited Partnerships it is of more than theoretical interest.

The note closed down 1.57% at $36.88.
(that's another thing, we put the price of the instrument up front; so readers can go back and check or so I can brag, whatev.)

From MarketBeat:
Will AMJ be the Next TVIX?
Last Thursday J.P. Morgan announced it would stop issuing new notes from its popular JPMorgan Alerian MLP Index ETN — aka AMJ — once AMJ hit 129 million notes outstanding. Questions are now swirling whether this will turn in a replay of the chaos that surrounded the Credit-Suisse backed ETN TVIX back in March.

On June 14, the day of the AMJ announcement by J.P. Morgan, there were 117,950,000 notes outstanding. By June 19, the remaining 11,050,000 were snapped up and the door was closed.

That the 11 million plus shares were grabbed almost immediately is notable. Over the course of this year, issuance of AMJ notes has steadily increased, but generally in increments of a million or so shares over the course of a week....MORE
We also have an interest in volatility:

Climateer Investing: TVIX Last Word (for today)
Climateer Investing: UPDATED--"TVIX collapse rocks volatility market"
Climateer Investing: TVIX: Here Come the Federales
It's Baaack: TVIX Premium to Indicative Value Creeping Up Again
"Recent TVIX Volume and VIX Futures Volume" (TVIX; VXX; UVXY; VIX)
UVXY (ProShares Ultra VIX Short-Term Futures ETF) is the best dirty hedge for the TVIX.
"Vix dog millionaire" (VXX; TVIX)
"The Vix feedback loop, analysed" (VXX; TVIX; XIV; XXV)
Deutsche Bank: TVIX Explosion Drives Vol-of-vol Higher (TVIX; VIX; VXX)
Le Freak: "Volatility of Volatility" (VIX; VXX; XIV; TVIX)
UPDATED--A Virtuoso Discusssion of the Recent Action in the VelocityShares Daily 2x VIX Short-Term ETN (TVIX)
And many, many more. Those are just some of the Spring 2012 posts