UVXY and SVXY are managed by the same issuer, ProShares, and both reference the same short-term VIX futures index. Yet they are mirror images: UVXY is a leveraged long bet on rising volatility, while SVXY is an inverse bet that profits when volatility falls. Understanding why one decays in calm markets and the other quietly compounds — and why that calm-market compounding hides a violent tail risk — is essential before trading either.
Neither tracks the spot VIX directly. Both reference a daily-rolling blend of first- and second-month VIX futures (the short-term futures index). Their fortunes are governed by the shape of the futures curve described in our term structure guide. For the full product lineup, see the VIX ETFs & ETNs guide.
Educational only
Inverse and leveraged volatility products are among the riskiest exchange-traded vehicles available to retail investors. The material below is educational and is not a recommendation to buy, sell, or hold any product.
The two products in one line each
- UVXY — ProShares Ultra VIX Short-Term Futures ETF. Targets +1.5× the daily return of the short-term VIX futures index. Goes up when fear rises.
- SVXY — ProShares Short VIX Short-Term Futures ETF. Targets −0.5× the daily return of the same index. Goes up when fear falls.
Side-by-side comparison
| Feature | UVXY | SVXY |
|---|---|---|
| Direction | Long volatility | Inverse (short) volatility |
| Daily objective | +1.5× index | −0.5× index |
| Issuer | ProShares | ProShares |
| Structure | ETF (commodity pool) | ETF (commodity pool) |
| Underlying | Short-term VIX futures (M1/M2) | Short-term VIX futures (M1/M2) |
| Contango effect | Headwind (decays) | Tailwind (collects roll yield) |
| Backwardation effect | Tailwind | Headwind |
| Profits when… | VIX futures rise (panic) | VIX futures fall / stay calm |
| Primary danger | Steady decay in calm markets | Sudden, large loss in a spike |
| Prior leverage | 2× before Feb 2018 | −1× before Feb 2018 |
| Ideal holding period | Intraday to a few days | Days to a few weeks, with stops |
Contango: the same force, opposite signs
The VIX futures curve is usually in contango — later-dated futures trade above nearer ones. Each day these products roll part of their position from the near-month future toward the next month.
- For UVXY (long), rolling from a cheaper near future into a more expensive later one is a recurring cost. In persistent contango this roll cost, amplified by 1.5× leverage and daily-rebalancing drag, grinds the price steadily lower. See VIX ETF decay in contango.
- For SVXY (inverse), the same roll works in its favour: being short the curve, it captures a small positive roll yield as expensive futures converge toward lower spot levels over time. This is why SVXY tends to drift higher during long calm stretches. The deeper logic is in VIX futures roll yield and our SVXY inverse VIX guide.
When the curve flips into backwardation — typically during a sell-off, when near-term fear exceeds longer-term fear — the signs reverse. UVXY suddenly benefits and SVXY is punished. Backwardation episodes are infrequent but coincide with exactly the moments inverse-volatility holders can least afford them.
The asymmetry that defines inverse products
The crucial feature of SVXY is not its average return but its asymmetric risk. In calm markets it earns small, frequent gains from roll yield. But a single sharp volatility spike can erase months of those gains in days, because the short-term futures index can double or more in a brief panic, and an inverse fund moves the opposite way against a near-unbounded upside in volatility.
February 5, 2018 — "Volmageddon"
- A modest equity decline triggered an outsized spike in short-term VIX futures into the close.
- The Credit Suisse XIV note — then a −1× inverse VIX product — lost roughly 96% of its value and was subsequently terminated by the issuer.
- SVXY, also −1× at the time, fell roughly 90% in the episode.
- Within weeks, ProShares de-levered SVXY from −1× to −0.5× and UVXY from 2× to 1.5× to make both less fragile.
That de-leveraging is the single most important fact about today's SVXY. At −0.5×, a one-day doubling of the index that would have wiped out a −1× product instead causes a large but survivable loss. The risk is reduced, not removed. Read the full account in our Volmageddon 2018 case study.
How traders actually use each
Typical use cases (illustrative, not advice)
- UVXY: a short, aggressive hedge or speculation that a spike is imminent — ahead of a known event or when the curve is flattening. Held intraday to a few days because decay is relentless.
- SVXY: harvesting the volatility risk premium and roll yield during calm, steeply contangoed markets — ideally entered after a spike has peaked and is receding, always with a hard stop.
- Both: position-size for a 100% adverse outcome, never average down, and never hold through a major macro event. The mechanics of the short side are covered in how to short volatility.
Why same-issuer, same-index products behave so differently
It can seem strange that two ProShares funds tracking the identical short-term VIX futures index can have such opposite fates. The answer is entirely in the sign and size of the daily multiplier, compounded over time.
- Sign determines who pays the roll. A long fund is structurally short roll yield in contango; an inverse fund is structurally long it. The very feature that bleeds UVXY feeds SVXY, day after day, in the most common market regime.
- Size determines fragility. UVXY's 1.5× magnifies both gains in a spike and the daily-rebalancing drag in chop. SVXY's −0.5× deliberately damps its exposure so a violent up-day in the index does not annihilate it.
- Daily reset compounds both. Because each fund rebalances to its target multiple every day, returns are path-dependent. Two markets that end at the same index level but take different routes will leave UVXY and SVXY at different prices — generally to the holder's disadvantage in choppy conditions.
This is also why the volatility risk premium — the tendency for implied volatility to exceed realized volatility — shows up as a tailwind for SVXY. We unpack that premium in implied vs historical volatility, and it is the same engine that powers the inverse-volatility trade.
Long-run behaviour, summarised
In a typical contango regime, UVXY bleeds lower while SVXY drifts higher — which can tempt investors into treating SVXY as a buy-and-hold. The February 2018 record shows why that is dangerous: the inverse product's calm-market gains are repeatedly funded by accepting rare, catastrophic loss days. UVXY's mirror image — steady decay punctuated by explosive rallies — is equally unsuitable for buy-and-hold. Both are tools for expressing a short-term view on the direction of volatility, and both demand active risk management. This is educational information, not investment advice.
Frequently asked questions
What is the difference between UVXY and SVXY?
UVXY is a leveraged long-volatility ETF targeting 1.5x the daily return of a short-term VIX futures index, so it rises when volatility spikes. SVXY is an inverse ETF targeting -0.5x the daily return of the same index, so it rises when volatility falls. They are opposite bets on the same underlying futures, with different gearing on each side.
Why was SVXY changed to -0.5x?
After the February 5, 2018 volatility spike known as Volmageddon, ProShares reduced SVXY's daily objective from -1x to -0.5x, effective late February 2018. The same event led ProShares to cut UVXY from 2x to 1.5x. The de-leveraging was a risk-management response to how violently inverse VIX products can lose value in a single day; the competing XIV note had collapsed about 96 percent and was terminated.
Does contango help SVXY or UVXY?
Contango is a tailwind for SVXY and a headwind for UVXY. When the VIX futures curve slopes upward, daily rolling pays the inverse SVXY a small positive roll yield in calm markets, while it imposes a roll cost that erodes UVXY. In backwardation the relationship flips: UVXY benefits and SVXY is penalized.
Is SVXY safer than UVXY?
Neither is safe. SVXY tends to grind higher in calm markets but carries asymmetric crash risk: a sudden volatility spike can wipe out a large share of its value in days, as happened in February 2018. UVXY tends to bleed lower most of the time but can rocket higher in a panic. Both are short-term trading vehicles, not buy-and-hold investments. This is educational information, not investment advice.