- Latest initiative represents Cboe and MSCI's growing
relationship and will expand Cboe's current product suite
- Cboe plans to offer three new options tied to MSCI's
international, developed, emerging and U.S. markets benchmark
indices, set to launch on March 18,
pending regulatory approval
- Cboe also introduces two new volatility indices based on
existing MSCI Index options and the proprietary VIX Index
Methodology
CHICAGO, Feb. 21,
2024 /PRNewswire/ -- Cboe Global Markets, Inc. (Cboe:
CBOE), the world's leading derivatives and securities exchange
network, today announced a new strategic initiative in
collaboration with MSCI Inc. (MSCI), a leading provider of critical
decision support tools and services for the global investment
community, to expand its suite of Cboe-MSCI Index options and
volatility indices. The initiative underscores Cboe and MSCI's
deepening relationship and continues to leverage the companies'
combined expertise to develop innovative solutions for investors
worldwide.
Cboe and MSCI have collaborated successfully for many years to
offer a variety of indices and tradable products. In this latest
initiative, Cboe will further expand its existing MSCI Index
options suite by introducing three new products based on additional
MSCI global indices: Cboe MSCI World Index Options (MXWLD),
Cboe MSCI ACWI Index Options (MXACW), and Cboe MSCI USA Index Options (MXUSA). These options are
set to begin trading on Monday, March
18, pending regulatory approval.
In addition, Cboe is broadening its volatility index suite with
the launch of two new Cboe MSCI Volatility Indices: the Cboe MSCI
EAFE Volatility Index (VXMXEA) and the Cboe MSCI Emerging Markets
Volatility Index (VXMXEF). Developed using Cboe's proprietary VIX®
Index methodology, these indices are based on existing MSCI EAFE
Index Options (MXEA) and MSCI Emerging Markets Index Options (MXEF)
and are designed to provide a transparent measure of the market's
expectation of 30-day implied volatility by these respective MSCI
index option classes.
Similar to the VIX Index, which is designed to reflect
investors' consensus view of future (30-day) expected U.S. stock
market volatility, the new Cboe MSCI Volatility Indices aim to
provide comparable measures for international and emerging equity
market volatility.
"In today's rapidly evolving landscape, investors require
sophisticated tools to navigate the markets with confidence," said
Catherine Clay, Global Head of
Derivatives at Cboe. "Our ongoing collaboration with MSCI reflects
our shared commitment to fostering innovation and providing
solutions that empower investors to better manage risk and seize
potential opportunities in the global marketplace. We are excited
to expand our Cboe-MSCI toolkit with additional index options and
volatility indices – an enhancement that will not only broaden our
customers' product choice, but also enrich the ways they interact
with and analyze the global markets." Clay added, "Crucially, the
three new index options, which cover developed and emerging
markets, are expected to also give investors comprehensive access
to gain a variety of different exposures around the globe."
The new options will be based on the MSCI World Index, the MSCI
ACWI Index and the MSCI USA Index,
which are renowned benchmarks for measuring international,
developed and emerging markets and U.S. equity performance,
respectively. Significantly, both MXWLD and MXUSA options will be
based on a fraction (1/100th) of the value of their
underlying index.
With a smaller index value, MXWLD and MXUSA options may be more
accessible to a broad base of customers with diverse investment
objectives, ranging from asset owners aiming to track benchmark
index exposure, registered investment advisers in search of new
sources of yield, or individual investors seeking straightforward
exposure to options linked to global benchmark indices.
"We are pleased to expand our strategic relationship with Cboe
in new offerings that investors around the world can use to help
them manage risk and exposure," said George
Harrington, Global Head of Derivatives Licensing at MSCI.
"The launch of the Cboe MSCI EAFE Volatility Index (VXMXEA) and
Cboe MSCI Emerging Markets Volatility Index (VXMXEF) provides the
investment community with benchmarks for option investing, and
Cboe's launch of options linked to the MSCI World Index, MSCI ACWI
Index and MSCI USA Index further
develops the ecosystem of tradable products."
MXACW, MXUSA, and MXWLD will have standard options that expire
on the third Friday of each month. In response to customer
feedback, Cboe plans to also list five end-of-week expirations,
which are expected to begin trading on March
21, 2024, pending regulatory approval.
The new index options join the current suite of Cboe MSCI
tradable products, which includes the Cboe MSCI EAFE Index Options
(MXEA) and Cboe MSCI Emerging Markets Index Options (MXEF). Like
these existing offerings, the newly launched options will follow a
European-style exercise (no early exercise), are cash-settled (no
delivery or assignment of shares) at expiration and may potentially
offer favorable tax treatment1. In addition, the new
options are integrated into Cboe's existing infrastructure and
will be traded and settled via the same exchange connections and
clearinghouse as the current Cboe MSCI index options.
For more information on Cboe MSCI Index options, visit Cboe's
website.
About Cboe Global Markets, Inc.
Cboe Global Markets (Cboe: CBOE), a leading provider of market
infrastructure and tradable products, delivers cutting-edge
trading, clearing and investment solutions to market participants
around the world. The company is committed to operating a trusted,
inclusive global marketplace, providing leading products,
technology and data solutions that enable participants to define a
sustainable financial future. Cboe provides trading solutions and
products in multiple asset classes, including equities,
derivatives, FX, and digital assets, across North America, Europe and Asia
Pacific. To learn more, visit www.cboe.com.
Media
Contacts
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Cboe Analyst
Contact
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Angela
Tu
|
Tim
Cave
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Kenneth Hill,
CFA
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+1-646-856-8734
|
+44 (0)
7593-506-719
|
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+1-312-786-7559
|
|
atu@cboe.com
|
tcave@cboe.com
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khill@cboe.com
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CBOE-C
CBOE-OE
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disclaims any duty to update the information herein.
Nothing in this announcement should be considered a
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merchantability, fitness for a particular
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timeliness, the results to be
obtained by recipients of the
products and services described herein, or
as to the ability of the indices referenced in this press release
to track the performance of their respective securities, generally,
or the performance of the indices referenced in this press release
or any subset of their respective securities, and shall not in any
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determined the constituents or weightings of the securities that
comprise the third-party indices referenced in this press release
and shall not in any way be liable for any inaccuracies or errors
in any of the indices referenced in this press release.
Options involve risk and are not suitable for all market
participants. Prior to buying or selling an option, a person should
review the Characteristics and Risks of Standardized Options (ODD),
which is required to be provided to all such persons. Copies
of the ODD are available from your broker or from The Options
Clearing Corporation, 125 S. Franklin
Street, Suite 1200, Chicago,
IL 60606.
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Some factors that could cause actual results to differ
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We do not undertake, and we expressly disclaim, any duty to
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Readers are cautioned not to place undue reliance on these
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1 Options involve risk and are not suitable for all
investors. Prior to buying or selling an option, a person must
receive a copy of "Characteristics and Risks of Standardized
Options." Copies are available from your broker or from The Options
Clearing Corporation at 125 South Franklin Street, Suite 1200,
Chicago, IL 60606 or at
www.theocc.com.
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SOURCE Cboe Global Markets, Inc.