Options Question of the Week

#OptionsQOTW #VIX #CBOERMC

Most of you didn't see that coming. When asked on Monday where you thought the VIX would close on Friday, 76% of you thought it would be 20 or higher. Insert buzzer sound here. VIX closed on Friday at 16.86 surprising many, as most major indices worldwide closed higher. 

The S&P 500 and Dow Jones Industrial Average closed at two-month highs Friday, while posting their third consecutive weekly rise, fueled by an oil-induced rally in the energy and materials sectors.

A better-than-expected nonfarm payrolls for February underscored continued improvement in the economy, while also raising expectations for at least another interest-rate increase this year by the Federal Reserve.

Financials stocks were among the biggest winners this week as well, as investors bet that improving economic data will keep the Federal Reserve on track to further tighten monetary policy, which generally helps banks.

Do you have ideas for an Options Question of the Week? Let us know at #OptionsQOTW.

 And speaking of polling questions, the Options Insider staff has been hard at work coming up with some fun for March Madness. Stay tuned....

Risk Management Conference

Options Insider Takes the Show on the Road

This week, CBOE hosted the 32^nd Annual Risk Management Conference. Mark Longo and Mark Sebastian were on hand, and were able to grab a few attendees for interviews.

Options Insider Radio Interviews: Talking Volatility with Convergex 

In this episode, our roving reporter Mark Sebastian is on assignment at the CBOE Risk Management Conference, where he sat down with Ben Londergan, Executive Managing Director, Head of Options Trading and Technology for Convergex

They discuss:

• Less liquidity, greater concentration levels
• Delineation between on-floor and off-floor liquidity
• Institutional money coming into the options market
• How will pension money impact the market in the next few years?
• Did the elevated VIX change client behaviors?
• Holding onto versus selling volatility
• What is Convergex doing for low-latency spread trades?
• What else is going on at Convergex?
• And more

Options Insider Radio Interviews: Talking Strategy with Russell FTSE Indexes 

In this episode, our roving reporter Mark Sebastian is on assignment at the CBOE Risk Management Conference, where he sat down with Pat Fay from FTSE Russell Indexes.

They discuss:

• Exploration of ETFs/ETNs based on various strategies
• Relative value trading; RUT vs. SPX
• FTSE 100 & FTSE China 50 futures contract at CME
• Cash options products coming soon at CBOE
• Where should Russell put its index efforts?
• New developments at FTSE and Russell

Options Insider Radio Interviews: Talking Volatility, Correlation and Adaptability with WallachBeth

Today, Mark is joined by Ilya Feygin live from the CBOE Risk Management Conference. They discuss:

• Ilya's experience in the options space
• The days before VIX was a trade-able product / volatility as an asset class
• What is the WallachBeth Scout Group?
• Threat evaluation, risk management, and execution reviews
• The right strategies for the right environments
• How to be adaptable in a way that is accessible to various asset managers
• The recent flight to safety
• Is exchange fragmentation impacting liquidity?

February Options Volume

Volume increases year-over-year

On Tuesday, OCC announced that overall exchange-listed options volume reached 331,918,260 contracts in February, up 10 percent from February 2015. Equity options volume reached a total of 296,684,498 contracts, an eight percent increase from February 2015. This includes cleared ETF options volume of 135,080,392 contracts last month, a 35 percent increase over February 2015 volume. Index options volume was up 29 percent with 35,233,762 contracts in February.

Year-to-date average daily equity options volume is up five percent with 15,975,714 contracts in 2016.

Here is how it all played out: