CME to Start Trading on Oil, Gold Volatility Indexes in Fourth Quarter

CME Group Inc., the largest futures exchange, will introduce trading in the fourth quarter in oil and gold futures and options contracts based on volatility indexes calculated with the Chicago Board Options Exchange.

The CBOE/Nymex WTI Volatility Index, based on New York Mercantile Exchange oil options price data, and the CBOE/Comex Gold Volatility Index “will give global market participants tradable tools to express their opinions on the direction of the volatility of the markets,” said Bryan Durkin, CME’s chief operating officer, in a statement.

CME plans to begin futures and options trading based on corn and soybean volatility indexes in the first quarter of 2011, according to the statement.

The indexes use CME options prices and CBOE methodology. They are the first to be introduced under a seven-year licensing agreement between CME and CBOE Holdings Inc., operator of the largest U.S. options exchange. It gives CME global rights to list futures and options for CBOE volatility indexes for a variety of products.

Shares of CME fell $2.98, or 1.1 percent, to $268.94 at 4:08 p.m. New York time in Nasdaq Stock Market trading. The shares have fallen 20 percent this year. CBOE, which went public in June, fell 34 cents, or 1.6 percent, to $21.52, also on the Nasdaq. Both companies are based in Chicago.

To contact the reporter on this story: Margot Habiby in Dallas at mhabiby@bloomberg.net.

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net.

• LinkedIn
• Google +1
• Print
• QUEUE