VIX Goes Back Into Contango

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Contango is a situation where the futures price of a commodity is above the expected future spot price. People are willing to pay more for a commodity at some point in the future than the actual expected price of the commodity.

As we cited earlier, volatility did indeed peak on that monster selloff, and the tell of backwardation (situation where the spot price is above the futures) was again very accurate. Take a look today at how it shapes up today:

Spot VIX is not higher than either weekly or monthly VIX futures, firmly back into Contango.
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