Company: SVIX
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001013762-25-004207
Chunk: 7

Company: VS Trust
Filing Date: 2025-03-28
Form: 10-K
Item: Item 1
Chunk 7
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 the next 30 days, the prices of VIX futures contracts are based on the current expectation
of the expected 30-day volatility of the S&P 500 on the expiration date of the futures contract. Since the VIX and VIX futures contracts
are two distinctly different measures, the VIX and VIX futures contracts generally behave quite differently.

An important consequence of the spot/forward
relationship between the VIX and VIX futures contracts (and therefore between the VIX and A Fund) that investors should understand is
that the price of a VIX futures contract can be lower, equal to or higher than the VIX, depending on whether the market expects volatility
to be lower, equal to or higher in the 30-day forward period covered by the VIX futures contract than in the 30- day spot period covered
by the VIX. Therefore the performance of VIX Futures contracts should be expected to be very different than the performance of the VIX
as there is no direct relationship between the two measures. As a result, since the performance of a Fund is linked to the performance
of the VIX futures contracts included in the Index, a Fund should be expected to perform very differently from the VIX (or -1x or 2x
thereof).

The VIX

The VIX is an index designed to measure the implied
volatility of the S&P 500 over 30 days in the future. The VIX is calculated based on the prices of certain put and call options on
the S&P 500. The VIX is reflective of the premium paid by investors for certain options linked to the level of the S&P 500.

●During
periods of rising investor uncertainty, including periods of market instability, the implied level of volatility of the S&P 500 typically
increases and, consequently, the prices of options linked to the S&P 500 typically increase (assuming all other relevant factors
remain constant or have negligible changes). This, in turn, causes the level of the VIX to increase.

●During
periods of declining investor uncertainty, the implied level of volatility of the S&P 500 typically decreases and, consequently,
the prices of options linked to the S&P 500 typically decrease (assuming all other relevant factors remain constant or have negligible
changes). This, in turn, causes the level of the VIX to decrease.

4

Volatility, and the level of the VIX, can increase
(or decrease) without warning. The V