The Weekly News Roundup is your weekly recap of CBOE features, options industry news and VIX and volatility-related articles from print, broadcast, online and social media outlets.
Interest in Bank Lending Market
In December, CBOE partnered with Environmental Financial Products (EFP) to create the American Financial Exchange (AFX), a new electronic marketplace that supports short-term funding for small- to mid-size banks. Since launch, AFX has processed over $600 million in loans.
“CBOE Libor Rival Platform Gains Steam” – Mike Kentz, International Financing Review
Exotic Variety in Options
Last week, CBOE began offering FLEX index options with Asian and Cliquet style settlement, providing additional hedging options for participants in the insurance industry, with the added benefits that come with execution on a traditional exchange.
“CBOE Targets Insurance Companies with New On-Exchange Cliquet/Asian Options” – Pablo Conde, Structured Retail Products
Continued Zest for Vest
Earlier this year, CBOE acquired a majority stake in Vest, an asset management firm that provides options-based investments through structured protective strategies and innovative technology solutions. CBOE and Vest are now planning to create new indexes based on the investment strategies developed by Vest.
“CBOE Preps Vest Downside Protected Indexes” – Waters Technology
VIX FIX – Volatility Beware
Investors were welcomed with another week of subdued markets with bulls sternly at the helm. Although slightly elevated today, the VIX Index had a relaxing week with a five-day streak below the 15 level, its longest run this low since last August. Some market participants believe this lull is merely a ruse. A few notable VIX trades indicate investors are stacking protection against a downturn. Is the market setting the stage for a pop?
“Yes, the VIX Has Fallen Hard but Don’t Ditch Stocks Just Yet” – Chris Dieterich, Barron’s
“Wall Street’s ‘Fear Gauge’ Nears Mid-August Low” – Nicole Bullock and Adam Samson, Financial Times
“Flows to Volatility ETFs Becoming Deluge as S&P 500 Rally Hedged” – Joseph Ciolli, Bloomberg
“Options Guru Says VIX Looks Poised to Pop, Sees ‘Volatility Overshoot’” – Chris Dieterich, Barron’s
“Did the VIX Fall Too Far, Too Fast?” – Chris Dieterich, Barron’s
“U.S. Stocks Drift Higher as Volatility Declines” – Corrie Driebusch and Riva Gold, Wall Street Journal
“All Calm, Volatility Gauge Dips to November Low” – Fast FT
“Five-Week Stock Run Risks Hitting the Wall” – Anora Mahmudova, MarketWatch
“Weekend Update: Exploring Trends in Market Volatility” – Dan Neagoy, See It market
“VIX: A Hedge to Consider For Your Portfolio” – Chris Kobryn, Seeking Alpha