Volatility investing: not for the faint of heart

Investors could risk major losses if they trade volatility-linked exchange traded products (ETPs) without fully understanding how they work, according to an investor alert released by the US Financial Regulatory Authority (Finra). 'These products are generally not designed to be used as buy-and-hold investments -and while they can generate eye-popping gains (a number of inverse volatility-linked ETPs had returned over 180% in 2017), they can also quickly lose some or all of their value in a ver