The Cboe Volatility Index (VIX), commonly known as the fear index, measures the market's expectation of short-term volatility among stocks. Based on S&P 500 index options with near-term expiration dates, the VIX can project 30 days' worth of volatility expectations. The VIX spiked early in March, reaching nearly 28—its highest level since August 2024—amid investor uncertainty about potential tariffs, cuts to federal programs, and much more.

While fear (or volatility) can be devastating to markets, investors may also see a spike in the VIX as an opportunity to make a sophisticated but risky bet on the index itself. While it's not possible to invest in the VIX directly, investors can buy shares of exchange-traded funds (ETFs) or notes (ETNs) that track the index.

There are a number of these funds, each with different advantages and disadvantages, and we look closely at three of the leading VIX products below. Investors should beware, though, that no fund will perfectly track the VIX, and all of them will lag behind the real-time movement of the index to some degree. Because the VIX can change quickly, this may impact an investor's strategy when making a bet on volatility.

A Unique Inverse Approach to the VIX

The Simplify Volatility Premium ETF (NYSEARCA: SVOL) takes a unique approach to the VIX—this fund aims for investment results of between -0.2x and -0.3x those of the VIX. That is, when the VIX decreases, indicating a reduction in investor fear about upcoming volatility, the ETF moves slightly upward. Alongside this inverse strategy, SVOL incorporates an options strategy that seeks to protect investors against significant volatility in the VIX.

Given its complex construction and active management, investors may be surprised to see that SVOL has an expense ratio of just 0.72%. With its limited inverse target, SVOL is not likely to ever generate significant returns. However, it can be a strong diversification play for investors seeking to mitigate or avoid the risks of other asset classes. It also has a healthy one-month average trading volume of roughly 1.5 million, so it should be relatively easy for investors to buy and sell shares of this fund if they wish to make more active trades.

Short-Dated VIX Futures But Some Risk of Variance

For a more direct link to the VIX, investors might consider the iPath Series B S&P 500 VIX Short-Term Futures ETN (BATS: VXX). VXX provides a daily rolling long position in first and second-month VIX futures contracts. With short-dated futures, VXX tends to follow the VIX fairly closely, although like other volatility exchange-traded products it runs the risk of varying more considerably.

As evidence of the possibility of variance, consider the year-to-date performance of the VIX (11.0%) and VXX (5%) as of March 19, 2025. Keep in mind, though, that holding VXX shares for longer than a day can lead to discrepancies with the VIX.

VXX also comes in with a higher annual fee than SVOL, and investors should expect to pay an expense ratio of 0.89%. One key advantage of this fund for active traders is its high average volume: as of March 18, 2025, it had a one-month average volume of 9.2 million.

High-Risk Double Long Leverage

One of the best options for long leverage on the VIX is the 2x Long VIX Futures ETF (BATS: UVIX). Investments in funds targeting the VIX are already inherently risky, given the use of futures contracts and the unpredictability of the VIX itself; adding 2x leverage into the mix makes this a highly risky option for only those with a particularly high tolerance.

UVIX also has an expense ratio of 2.19%, which is likely to scare away all but the most certain investors.

Still, for active traders willing to take on the risk, UVIX is one of the few funds available, providing leveraged exposure to the VIX. It's also highly liquid, with a one-month average trading volume of 8.5 million. If a traditional VIX ETF does not provide sufficient exposure to the index, UVIX may be worth a closer look.

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