iPath Series B S&P 500 VIX Mid-Term Futures ETN (VXZ) Covered Calls

iPath Series B S&P 500 VIX Mid-Term Futures ETN is an exchange-traded note designed to provide exposure to the S&P 500 VIX Mid-Term Futures Index Total Return. The firm offers a daily rolling long position in the fourth, fifth, sixth, and seventh month VIX futures contracts. By targeting the middle of the volatility curve, the note provides a tactical tool for hedging equity risk with lower daily decay than short-term instruments during extended market stress.

You can sell covered calls on iPath Series B S&P 500 VIX Mid-Term Futures ETN to lower risk and earn monthly income. Born To Sell's covered call screener gives you customized search capabilities across all possible covered calls but here are a couple of examples for VXZ (prices last updated Fri 4:16 PM ET):

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The iPath Series B S&P 500 VIX Mid-Term Futures ETN (VXZ) is a volatility-linked financial instrument that tracks the daily rolling performance of medium-term VIX futures. Unlike its short-term counterpart (VXX), which tracks the front-month contracts, VXZ focuses on the fourth through seventh month of the VIX futures curve. This structural difference makes the note significantly less sensitive to daily "noise" in the spot VIX, while reducing the impact of negative roll yield (contango) that typically erodes the value of short-term volatility products.

2026 Performance and Volatility Outlook

In the first quarter of 2026, VXZ demonstrated its characteristic "slow-burn" profile. While the broader equity markets saw a mid-quarter rally, the note successfully hedged against the April 2026 retracement, posting a year-to-date return of 9.83% as of April 6, 2026. This performance reflects a 3-month gain of 10.49%, outperforming short-term instruments that were more heavily impacted by the rapid decay of front-month premiums. The note’s closing indicative value of $56.45 in early April 2026 reflects a stabilized pricing environment as institutional investors shifted from aggressive speculation to longer-duration "tail risk" protection.

Financially, the note manages approximately $40.52 million in assets as of April 2026. Issued by Barclays Bank PLC, the ETN carries the credit risk of the issuer and charges an annual investor fee of 0.89%. Despite its lower AUM compared to VXX, the note remains a critical tool for macro hedge funds and institutional desks that require a "volatility buffer" that can be held for weeks rather than days. The average 20-day volatility for the note stood at 31.51% in April, roughly half that of the short-term VIX futures instruments.

Competitive Landscape

The mid-term volatility market is a specialized niche within the broader "Tactical Tools" segment, characterized by a few key players. Key competitors include:

1. ProShares VIX Mid-Term Futures ETF: The primary direct competitor. They compete by offering a traditional ETF structure tracking the same mid-term index, providing an alternative for investors who wish to avoid the credit risk associated with Barclays' ETN structure.
2. iPath Series B S&P 500 VIX Short-Term Futures ETN: The short-term variant from the same issuer. They compete for investor capital by offering higher convexity and greater sensitivity to immediate market shocks, albeit at the cost of much higher daily decay.
3. ProShares VIX Short-Term Futures ETF: A leading short-term peer. They compete by offering high-liquidity exposure to front-month futures, often used by tactical traders in conjunction with VXZ to create "volatility spread" strategies.
4. SPDR S&P 500 ETF Trust: The ultimate benchmark for VXZ. Most institutional users view VXZ as a "Beta-Hedge" against large-cap equity portfolios, making the performance of SPY the primary driver for entering or exiting VXZ positions.

Strategic Outlook and Risk Management

The firm is prioritizing "Curve Analysis" education in late 2026, helping investors distinguish between the "Spot VIX" and the futures curve. Strategic efforts are focused on improving the indicative value transparency to ensure that the note trades close to its net asset value during periods of high market stress. Management has highlighted that while VXZ is less susceptible to "Contango Bleed" than short-term products, it is still subject to significant long-term decay if the futures curve remains in its typical upward-sloping state.

Looking toward 2027, the note is positioned as a primary hedge against the "Agentic AI" infrastructure cycle’s potential overvaluation. As major tech holdings face tougher year-over-year comparisons, VXZ offers a vehicle to capture a sustained rise in mid-term market anxiety. Investors are encouraged to monitor the "Roll Yield" closely, as the note is most effective when the mid-term portion of the VIX curve flattens or inverts during prolonged periods of economic uncertainty.

Want more examples? VXX Covered Calls | VYGR Covered Calls