Cboe Volatility Index (VIX®) Futures
Trade VIX futures on Cboe Futures Exchange℠ (CFE®) to implement your view using volatility trading strategies, including risk management, alpha generation, and portfolio diversification.
Introduced in 2004, these innovative financial instruments provide market participants with the ability to trade a volatility futures product based on the well-established VIX Index methodology, reflecting the market's estimate of the VIX Index's value on various future expiration dates.
Key Benefits
- Provides a means to offset potential losses in an equity portfolio during broad market declines, leveraging the inverse relationship between the VIX and the S&P 500 Index.
- Allows market participants to express a pure bullish or bearish sentiment on the level of expected market volatility by buying or selling VIX futures and options.
- Offers opportunities to capitalize on the historical tendency for implied volatility (from SPX options) to be priced higher than subsequently realized volatility.
- Facilitates various calendar spreading strategies due to the mean-reverting nature of volatility and the wide range of VIX futures expirations available.
- As a volatility-centric instrument, VIX exposure can offer diversification benefits to a portfolio primarily composed of traditional equity and fixed-income assets.
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