Cboe Global Markets, Inc. has introduced Options on Cboe Volatility Index Futures (VX Options), a new financial product designed to offer traders more sophisticated tools for expressing directional views and managing exposure to equity market volatility. This launch is timely, as the Options Clearing Corporation reports U.S. options volumes reached over 11 billion contracts in 2023, a 126% increase since 2019, with average daily volumes in 2024 showing an 8% rise from the previous year.
The VX Options are European-style, physically settled options with PM settlement, based on VX futures which are cash-settled futures on the Cboe Volatility Index. These options provide a unique payout profile, enabling investors to take short-term views on forward volatility movements and potentially enhancing market liquidity. Catherine Clay, Global Head of Derivatives at Cboe, highlighted the product's role in meeting growing customer demand for efficient and seamless trading experiences.
This new offering is part of Cboe's strategy to expand its volatility product suite, complementing innovations like the Cboe S&P 500 Variance futures. It aims to equip investors with advanced tools for volatility and risk management, especially during uncertain market periods. For those looking to deepen their understanding of these products, Cboe's Options Institute provides educational resources, including free online courses and webinars.
The launch of VX Options marks a pivotal moment in the derivatives market, reflecting the increasing sophistication of investors in utilizing such instruments for portfolio management and risk mitigation. For more information on Cboe's offerings, visit https://www.cboe.com.
