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.
VIX FIX – Volatility Stands By, Bye, Buy
Markets retreated this week, coming off of their March gains. The VIX Index spiked to 16.70 on Thursday, before leveling out at 15.36 on Friday. As the VIX Index trends lower this month, some investors are using VIX to pack their portfolios with protection, predicting an even sharper drop ahead. While volatility is saying “bye,” some investors are saying “buy.”
“Stocks: Never Short a Dull Market” – Ben Levisohn, Barron’s
“Smart Money Flunks Out With $2 Billion of VIX Bets Unwinding” – Joseph Ciolli
“VIX Call Spreads Seen As Market Dithers” – Daniel O’Leary, EQ Derivatives
“VIX Continues Lower To Test Key Support” – Anna Coulling, Investing.com
“Goldman Says Low VIX New Normal…For Now” – Mark Melin, Value Walk
“Volatility Update: When Fear is Low, Look Out Below” – Georgio Stoev, Saxo Group
“Amid Calm, US Stock Investors Steel Themselves for Shocks” – Business Recorder
“The Benefits and Drawbacks of Market Tranquility” – Adam Freedman, Seeking Alpha
Department of Labor Fiduciary Proposal
On Wednesday, the Department of Labor (DOL) released its final Conflict of Interest Rule and related exemptions. The final rule and related exemptions permit all asset types, including exchange-traded options and futures, to be used in ERISA plans (401(k)) and IRAs.
CBOE released the following statement from Edward Tilly, CBOE Holdings Chief Executive Officer:
“The DOL Fiduciary Proposal raised significant issues for the U.S. options industry. CBOE’s foremost concern was that the Proposal would eliminate the ability of investors to use exchange-traded options and futures in ERISA plans (401(k)) and IRAs. We are pleased that in response to comments from various parties, including CBOE, our customers and the U.S. Securities Markets Coalition, the Proposal was modified to cover all asset types, including options and futures. CBOE is grateful to members of Congress, from both sides of the aisle, who took the time to study this complex issue and to sign letters to the DOL in support of our position. We are also grateful to the DOL for understanding and ultimately addressing the importance of allowing investors to continue to use exchange-traded options and futures in their retirement accounts and IRAs.”
For more information, see the CBOE Government Relations Website.