CBOE Plans Extended VIX Trading, Russell Volatility FuturesSam Mamudi
CBOE Holdings Inc. said it will extend the trading hours for futures on the benchmark gauge of U.S. options prices starting in October, while introducing contracts on its Russell 2000 Index volatility measure.
Beginning on Oct. 28, futures trading on the Chicago Board Options Exchange Volatility Index, or VIX, will be open from 3 a.m. to 4:15 p.m. New York time on each weekday, according to a statement today. On Monday through Thursday, there will be an additional session from 4:30 p.m. to 5:15 p.m. New York time, starting on Oct. 21.
CBOE, the biggest operator of American options exchanges, is trying to win more business outside the U.S. with the extended hours. A software update to prepare for the shift caused a malfunction that shut Chicago-based CBOE’s main market for three-and-a-half hours in April, prompting the company to delay the introduction of longer VIX futures trading hours.
“We are pleased to provide our European customers with the opportunity to trade VIX futures during local trading hours, but we also believe our entire global base of VIX users will benefit by extended trading hours,” CBOE Chief Executive Officer Edward Tilly said in today’s statement.
Futures based on the Russell 2000 Volatility Index will start on Oct. 30, with options available for trading “in the weeks that follow,” the exchange said in a statement today. While the VIX is based on expected price swings for the Standard & Poor’s 500 Index, the new contracts will offer investors the chance to place bets on small-company stocks.
CBOE shares fell 0.3 percent to $45.23 today. The stock has rallied 54 percent in 2013, the third-biggest gain in the Bloomberg World Exchanges Index and the best performance among U.S.-based markets.