OVX futures?

That's wishful thinking on CBOE's part, IMO. Big hint: they extended their MM solicitation timeframe.

A market-maker is going to have to hedge his book in the OTC market or on Clearport, and the bid-ask spreads in the straddles over there are going to make that 15 cents a tough way to make money.
 
Quote from Rodney King:

OMG, OMG! They might have to take <i>risk</i> to make money!
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With that bid / ask spread requirement, they would also have to financially subsidize the Market Maker... which has been done before, and quite honestly might not be a bad way to introduce the product. If anyone thought they could make money on a fifteen cent bid / ask spread, then they already would have had their lead MM designated (especially given the vol trends in that market, and the practical hedging alternatives).

With all the action in the underlying, maybe CBOE shouldn't be so cheap. I mean, if they can sponsor high dollar Chicago sports and social venues, they could subsidize a market-maker for what might potentially be one of their biggest products.

Idiots.
 
If you read the market-making proposal, the CBOE is proposing a revenue share on the instrument (beyond the spread + commission rebates), for some amount of time. I don't remember the exact number.
 
CBOE is moving way too slow on this.

They need to get this contract going before it gets poached.

Revenue sharing, while the market-making party takes on all the risk ? Meanwhile, they spend huge $$$ at Wrigley Field and Chicago Stadium and on and on. But susidize product liquidity, God forbid. And what increases share valuation... advertising or contract volume ?

Dolts.

Eurex will be doing it.
 
Quote from bone:

Eurex will be doing it.
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Other problems there... regulatory issues behind trading international futures/options are a pain in the butt that I still haven't fully figured out.
 
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