VIX FUTURES contract

The technique was developed in Germany the
VDAX future, however, there was never real liquidity into it
and it is no longer listed.
 
I'm also very much looking forward to these, particularly the new VIX options. Structuring positions to isolate the vega on the VIX should be an interesting exercise to say the least.
 
I agree with you all. This is an outstanding development and adds one more tool to the arsenal of options traders of all persuasions.

I think I read that they are cash settled.

The additional fact that they are providing day by day historical prices of VIX vs. VXO means that backtesting can occur...a very nice surprise.
 
Quote from ktm:


I think I read that they are cash settled.
More...

Hmm, KTM. I thought physical delivery of gammas and vegas would be most interesting.:D
 
My guess is the proposed VIX contract will be unsuccessful. It might be appealing to some of you as a place to lay off risk in your option positions, but there will not be any degree of public acceptance.

OldTrader
 
Expanding on what Vega said...

Once the VIX options start trading, you could calculate a VIX prime, or "volatility of volatility". Instead of a "fear gauge", you'd have a "fear of fear gauge".

"I'm not worried about a bear market, but I am worried about other people becoming worried about a bear market -- so I'll buy some VIX calls." :p
 
Quote from alfonso:

Anyone know how it will be settled?


Hmm, KTM. I thought physical delivery of gammas and vegas would be most interesting.
More...

Well I thought I'd try and help him...didn't give it much thought but I had to laugh when I read yours. I'll leave a spot in the garage for the vega...hope they send me a clean one, maybe black with some mag wheels and a Hurst shifter.
 
Lol. :D
Obviously it would be cash settled, but for some reason when I read that article I thought, "oh wow, Vix futures. I wonder how that's going to work" and I just posted the question.
 
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