Much like fate, volatility is an untamed animal. You’re probably wondering, “How so?” Let’s imagine volatility as a tiger. One minute it could be cute and fuzzy (low VIX) where you can pet it. Then the next minute it could start mauling your face (spike in VIX) because you looked at it funny. Much like the market, a downturn can happen at any moment which can cause the VIX to spike.
Due to their nature and potential to experience significant price movement in a short period of time, tastyworks has higher margin requirements for certain volatility products. These products include VIX, SVXY, UVXY, VXX, VIXY, VIXM, VXZ, EVIX, VMAX, VMIN, & VIIX. The rates used for uncovered options in these symbols are 100% (standard) / 75% (minimum).