Why the VIX Drops Before 3-Day Weekends

Russell Rhoads spent a decade at Cboe and wrote the textbook on volatility derivatives. He has a warning for anyone reading a low VIX print this afternoon. Ahead of a three day weekend, traders mark volatility inputs down for the days the market is shut, then mark them back up. That affects the spot index and not the futures, so a soft Friday reading is a calendar artifact rather than risk leaving the market. He also explains why the index cannot be traded or replicated at all, and how settlement quietly stops counting once it hits two consecutive missing bids. 📊 tastylive: https://www.tastylive.com/ 📰 Get Tom's pre-market analysis every morning: https://www.tastylive.com/newsletters 📘 FREE Options Strategy Guide: https://tinyurl.com/bp9ms763 📱 Follow tastylive on X: https://x.com/tastyliveshow Chapters 0:00 What opens the conversation 0:44 Why you cannot trade spot 1:22 The line compliance gave him 1:57 Firms tried to replicate it 2:29 Working on the regulatory side 3:01 How settlement actually ends 3:33 Two no bids and stop 4:11 What it would take to move it 4:41 Why the overnight risk kills it 5:12 A case he still remembers 6:12 The three day weekend effect 6:47 Do not misread the print 7:36 Why the futures do not move 8:18 What traders used to do 9:41 What he discloses about it #tastylive #vix #volatility #vixfutures #optionstrading #marketstructure #cboe #optionseducation #tastytrade #trading tastylive is a real financial network, producing hours of live programming every day. Follow along as our experts navigate the markets, provide actionable trading insights, and teach you how to trade. With over 120 original segments, and over 25 personalities, we'll help you take your trading to the next level, whether you are new to trading or a seasoned veteran. tastylive content is created, produced, and provided solely by tastylive, Inc. ("tastylive") and is for informational and educational purposes only. It is not, nor is it intended to be, trading or investment advice or a recommendation that any security, futures contract, digital asset, other product, transaction, or investment strategy is suitable for any person. Trading securities, futures products, and digital assets involve risk and may result in a loss greater than the original amount invested. Investment information provided may not be appropriate for all investors and is provided without respect to individual investor financial sophistication, financial situation, investing time horizon or risk tolerance. Options, futures, and futures options are not suitable for all investors. Prior to trading securities, options, futures, or futures options, please read all applicable risk disclosures, including, but not limited to, the Characteristics and Risks of Standardized Options Disclosure and the Futures and Exchange Traded Options Risk Disclosure Statement found at https://tastytrade.com/disclosures/. Past performance is not indicative of future results. Performance is not presented net of all commissions, fees, and expenses. Multi-leg option strategies incur higher transaction costs than single leg trades as they involve multiple commission charges. Examples provided are for illustrative, informational, and educational purposes only and are not intended to be reflective of results you can expect to achieve. Supporting documentation for any claims, including claims made on behalf of options programs), comparisons, statistics, or other technical data, if applicable, will be supplied upon request. tastylive, through its content, financial programming or otherwise, does not provide investment or financial advice or make investment recommendations. tastylive is not a licensed financial adviser, registered investment adviser, or a registered broker-dealer.