New records recently were set for volume and open interest for Cboe’s large-sized options on MSCI Emerging Markets Index (MXEF) -

  • One-day volume on September 28 - 9,007 (including 3,203 puts and 5,804 calls)
  • Average daily volume per month in September – 848
  • Open interest on September 28 – 18,774


MXEF OPTIONS AND MANAGING GLOBAL EQUITY EXPOSURE

Cboe’s options on the MSCI Emerging Markets Index (MXEF) are for investors who wish to manage global equity exposure. Key features of the MXEF global index options include —

Efficiency with large contract size – cash-settled options on the MXEF Index have a $100 multiplier and a notional size that is about 26 times larger than the options on the EEM ETF.

Simplicity – achieve broad-market exposure in one trade, as options on MSCI options offer investors tools with the potential to adjust exposure to the global markets at a fraction of the cost of buying individual stocks and ETFs.

Cash settlement – with no unwanted delivery of stocks or ETFs.

Predetermined risk for option buyers – index option purchasers risk only the premium they pay for the option. The risk is both known and limited.

European-style exercise – which protects option sellers against assignment prior to expiration (so-called “early assignment”).

NEW DEVELOPMENTS FOR MXEA AND MXEF OPTIONS

NEW WEEKLYS OPTIONS. On September 6, Cboe Options Exchange launched Friday-Expiring Weeklys options on the MSCI EAFE Index and MSCI Emerging Markets Index. See this recent Cboe notice for more details.  Weeklys options can provide opportunities for investors to implement more targeted buying, selling or spreading strategies. Weeklys options may help investors efficiently take advantage of market events, such as earnings, government reports and Fed announcements.

NEW LEAD MARKET MAKER. Earlier this year, Susquehanna Securities was selected as the Lead Market Maker (LMM) in the Regular Trading Hours (RTH) session for the MXEA and MXEF index options.

NEW LAST DAY OF TRADING. The last day of trading for an expiring series has been changed to the close of business on the last trading day (usually a Thursday) immediately prior to the expiration date.

CHINA A-SHARES. After the posting of a 2017 blog, in June 2018, MSCI began partial inclusion of more than 220 China large-cap A-shares in the MSCI Emerging Markets Index. A-shares are the stocks of companies incorporated in mainland China, quoted in renminbi, and listed on exchanges in Shanghai and Shenzhen. Inclusion at a 5% initial weight could lead to approximately $22 billion of capital inflows into these stocks.

MORE INFORMATION

For more information on managing global risk and on MXEF options, please visit the the MXEF website at www.cboe.com/MXEF.