The Long and Short of Futures Options: Talking Volatility, Indices and ETFs
In this episode, Mark is joined by Scot Warren, Senior Managing Director of Equity Index Products at CME Group
What to Know:
- An overview of the deal CME struck with McGraw-Hill for the S&P indices.
- Is this joint venture as a great way to help penetrate developing and emerging markets outside the USA?
- Scott walks through the deal to license the VIX methodology from the CBOE as well.
- An update on the NYMEX crude oil VIX and the Gold VIX
- Is there any plan to take the next step into an actual, tradable soybean and/or corn VIX right now?
- Are there any plans to continue licensing the realized vol methodology for the vol contracts on the Euro, or other methodologies?
Whatís New:
It's time for volume numbers, an overall down month. Does CMEís options complex follow in similar suit? The short duration contracts have really diverge into two use-cases, between equity options and futures options.
It's time for volume numbers, an overall down month. Does CMEís options complex follow in similar suit? The short duration contracts have really diverge into two use-cases, between equity options and futures options.
What to Watch:
Trading Futures on Apple. The CME has completely missed out on the explosion of interest in single name equities, like Apple, Google, etc., I'd imagine this should be a very interesting business for them. Are there any plans to revitalize the single stock futures market. Perhaps through 1 Chicago, so the CME can list futures and options, and futures options on single name equities. Also, if possible, I would long to have Long and Short of Futures Options come out more frequently than once a month. Right now this is pretty much the only futures options game in town, so we need more of it. (Via The Options Insider forum from Monkey Boy)
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- Updates on the development you have coming down the pipe in ETF options.
- Will mini options going to be another new product trend that you continue to push going forward?
- What other platform and tools upgrades can a futures options trader expect in the near future?
- Are you happy to know you have the best offering from a spread perspective for options traders?
- Do you see incentivizing the professional audience as an important initiative for the CME?
Whatís on Your Mind: Taking on Listener questions
Does the CME's licensing deal with the S&P mean that they can trade SPX contracts at the CME? If not, then what about when the CME license expires? Does the CME plan to list SPX at that time? (Via email from Tim W., Tacoma, WA)
Does the CME's licensing deal with the S&P mean that they can trade SPX contracts at the CME? If not, then what about when the CME license expires? Does the CME plan to list SPX at that time? (Via email from Tim W., Tacoma, WA)
Trading Futures on Apple. The CME has completely missed out on the explosion of interest in single name equities, like Apple, Google, etc., I'd imagine this should be a very interesting business for them. Are there any plans to revitalize the single stock futures market. Perhaps through 1 Chicago, so the CME can list futures and options, and futures options on single name equities. Also, if possible, I would long to have Long and Short of Futures Options come out more frequently than once a month. Right now this is pretty much the only futures options game in town, so we need more of it. (Via The Options Insider forum from Monkey Boy)
What are CME group's plans for the VIX license or more tradable products on the horizon? (Via Twitter from Alex103)
About Mark S. Longo
Mark S. Longo is the founder of The Options Insider Inc. - a firm dedicated to providing free options information, education, news and analysis for options users. Whether it's on TheOptionsInsider.com, a leading online options destination; through Options Insider Radio, the world's only radio network for options users; or through a growing number of newsletters and live events, Mr. Longo continues to provide new ways to spread the word about options.Mr. Longo's analysis of the options market has appeared in a wide variety of domestic and international publications, including The Wall Street Journal, Financial Times, Reuters, Futures Magazine, and more. As one of the few industry commentators with practical options experience, he has developed a substantial following among industry veterans and newcomers looking for insight into this complex market.Mr. Longo began his career as an options trader on the floor of the Chicago Board Options Exchange.
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