VIX Weeklys Options Launched – In VIX Options Chain; More Precision and Responsiveness

Yesterday (October 8) was the first day of trading for the VIX Weeklys options, with reported trading volume topping 1,000 contracts.

VIX OPTIONS CHAIN

A key feature of the new VIX Weeklys options is that they are in the same options chain as the standard-expiration VIX options.  This screenshot below from Bloomberg on the morning of October 9 shows that there now are VIX options expirations on Oct 21, Oct. 28, Nov. 4, Nov. 18, and Dec. 16 (in addition, there are VIX options with longer dated expirations).1 vix omon

MORE PRECISION AND RESPONSIVENESS

The addition of weekly expirations to standard monthly futures and options expirations offers volatility exposures that more precisely track the performance of the VIX Index. The closer VIX futures and options are to expiration, the more closely they generally track the VIX Index. By ‘filling the gaps’ between monthly expirations, investors may obtain new opportunities to establish short-term VIX positions, and fine-tune the timing of their hedging and trading activities.

The chart below shows select VIX futures in August.  The week 34 VIX Weekly futures settled on the morning of Wednesday, August 26. As noted in the subheading, over a 3-day period the VIX Index rose 167% and the week 34 VIX Weekly futures rose 147% (while the standard-expiration VIX futures had smaller moves).2. vix wEEKLY FUT

CONCLUSION

To learn more about VIX Weeklys futures and options, please visit www.cboe.com/VIXWeeklys.