If there is one foolproof way to make money in today’s markets, it’s selling any and every blip higher in volatility – in fact it’s so easy a Target manager can do it and make millions. However, something very different happened last week…

3 of the 4 trading days last week saw SVXY fund outflows with Wednesday the largest single-day outflow in history…

The Short VIX ETF SVXY, up more than 150% this year amid a slump in equity swings, lost almost $330 million in four days – the biggest weekly outflow in history…

While traders added money to a note that climbs with increasing turbulence.

Should the VIX suddenly spike, the repercussions of such a move would be further complicated by the billions of dollars sitting in various VIX-linked ETFs. Because individuals sellers would probably disappear from the market in such a situation, the ETF market makers would find it nearly impossible to hedge their positions, potentially triggering the dissolution of the funds or even the collapse of some of these firms. The Macro Tourist’s Kevin Muir explains: