CBOE Cboe Global Markets (MM)

• New Cboe S&P 500 Dispersion Index (DSPX) expands Cboe's leading suite of volatility indices
• The first-of-its-kind index designed to measure expected dispersion in the S&P 500 Index
• Aims to provide deeper insights into volatility of S&P 500 Index vs. those of its components

CHICAGO , Sept. 25, 2023 /PRNewswire/ -- Cboe Global Markets, Inc. (Cboe: CBOE), the world's leading derivatives and securities exchange network, and S&P Dow Jones Indices (S&P DJI), the world's leading index provider, today announced plans to launch the Cboe S&P 500 Dispersion Index (DSPX) on Wednesday, September 27. Jointly developed by Cboe Labs, the company's innovation arm, and S&P DJI, this new index is the latest addition to Cboe's volatility index suite and aims to provide deeper insights into U.S. equity market volatility.

Dispersion can be used by market participants to gain visibility into potential opportunities for portfolio diversification. Specifically, dispersion strategies allow investors to model the impact of company-specific risk on a portfolio by measuring the variability of volatilities for single-name stocks relative to the volatility of the index itself.  

In the case of DSPX, this new index may help investors better understand how the S&P 500 Index – one of the largest and most actively traded indices in the world – moves relative to the constituent companies in the index – 500 of the largest public companies listed in the U.S. – over the next 30 calendar days. Similar to the methodology used for the Cboe Volatility Index® (VIX® Index), the calculation for the DSPX Index is derived from prices of S&P 500® Index options (SPX) and the single stock options of the S&P 500 Index's constituent companies. 

"As a leading global exchange operator with unparalleled product innovation expertise, Cboe is uniquely positioned to gain insight into what market participants are looking for and in turn develop solutions to help meet their needs," said Rob Hocking, Senior Vice President and Head of Product Innovation at Cboe. "Cboe transformed volatility trading with the creation of the VIX Index 30 years ago and we continue to explore new frontiers in the volatility space. We believe the new Cboe S&P 500 Dispersion Index will provide investors with a further view into market volatility, complementing other volatility indices in our product suite. The opportunity to potentially trade exchange-listed futures on this index is expected to also help break down access barriers to allow more investors to utilize dispersion trading strategies."

"Market benchmarks and their volatilities, including measures such as the VIX Index, have become ubiquitous in describing the prevalent risk regime. However, market volatility expresses only a fraction of the overall opportunity set and risks," said Tim Edwards, Global Head of Index Investment Strategy at S&P Dow Jones Indices. "By collaborating with Cboe to launch DSPX, market participants will have another tool to further understand opportunities for diversification as well as risks within the world's most liquid equity benchmark."

Cboe Labs plans to develop a futures product on the DSPX Index to be listed on Cboe Futures Exchange (CFE), subject to regulatory review, which will potentially enable investors to manage their exposure and express views on SPX dispersion, or transfer risk between SPX options and options based on the underlying S&P 500 Index constituents.

Cboe and S&P DJI will host a webinar on the new DSPX Index and the potential benefits of dispersion trading on Wednesday, October 4.  Additional information and registration details can be found online here.  

In addition, the new index will be a topic for a panel discussion at Cboe's Global Risk Management Conference (RMC), taking place from October 17-20, 2023, in Austin, Texas. To learn more about RMC, visit the conference website.

About Cboe Global Markets, Inc.

Cboe Global Markets (Cboe: CBOE), the world's leading derivatives and securities exchange network, delivers cutting-edge trading, clearing and investment solutions to people around the world. Cboe provides trading solutions and products in multiple asset classes, including equities, derivatives, FX, and digital assets, across North America, Europe and Asia Pacific. Above all, we are committed to building a trusted, inclusive global marketplace that enables people to pursue a sustainable financial future. To learn more about the Exchange for the World Stage, visit www.cboe.com.­­­­­­

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Cboe®, Cboe Global Markets®, Cboe Volatility Index®, and (VIX®) are registered trademarks of Cboe Exchange, Inc. The S&P 500 Index is proprietary to S&P Dow Jones Indices LLC.   S&P®, S&P 500®, DSPX™, DSPBX™, S&P 100®, SPX®, SPY®, Select Sector®, The 500 and US500 are trademarks of Standard & Poor's Financial Services, LLC and have been licensed for use by Cboe Exchange, Inc. Cboe Exchange's contracts on the Cboe S&P 500 Dispersion Index, Cboe Volatility Index, S&P 500 Index, S&P 500 ESG Index and Select Sector Indices are not sponsored, endorsed, marketed or promoted by S&P Dow Jones Indices and S&P Dow Jones Indices does not have any liability with respect thereto.  All other trademarks and service marks are the property of their respective owners. © 2022 Cboe Exchange, Inc. All rights reserved.

Cboe Global Markets, Inc. and its affiliates do not recommend or make any representation as to possible benefits from any securities, futures or investments, or third-party products or services. Cboe Global Markets, Inc. is not affiliated with S&P. Investors should undertake their own due diligence regarding their securities, futures and investment practices. This press release speaks only as of this date. Cboe disclaims any duty to update the information herein.

There are important risks associated with transacting in any of the Cboe Company products discussed here. Before engaging in any transactions in those products, it is important for market participants to carefully review the disclosures and disclaimers contained at: https://www.cboe.com/us_disclaimers/.

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 (ODD). Copies of the ODD are available from your broker or from The Options Clearing Corporation, 125 S. Franklin Street, Suite 1200, Chicago, IL 60606 (investorservices@theocc.com). The information in this document is provided for general education and information purposes only. No statement(s) within this document should be construed as a recommendation to buy or sell a security, or to provide investment advice. Supporting documentation for any claims, comparisons, statistics or other technical data in this document is available by contacting Cboe Global Markets at www.cboe.com/contact. Past performance is not predictive of future returns.

Trading in futures and options on futures is not suitable for all market participants and involves the risk of loss, which can be substantial and can exceed the amount of money deposited for a futures or options on futures position. You should, therefore, carefully consider whether trading futures or options on futures is suitable for you in light of your circumstances and financial resources. You should put at risk only funds that you can afford to lose without affecting your lifestyle. For additional information regarding the risks associated with trading futures and options on futures and with trading security futures, see respectively the Risk Disclosure Statement Referenced in CFTC Letter 16-82 and the Risk Disclosure Statement for Security Futures Contracts.

Nothing in this announcement should be considered a solicitation to buy or an offer to sell any securities or futures in any jurisdiction where the offer or solicitation would be unlawful under the laws of such jurisdiction. Nothing contained in this communication constitutes tax, legal or investment advice. Investors must consult their tax adviser or legal counsel for advice and information concerning their particular situation.

Cboe Global Markets, Inc. and its affiliates, to the maximum extent permitted by applicable law, make no warranty, expressed or implied, including, without limitation, any warranties as of merchantability, fitness for a particular purpose, accuracy, completeness or timeliness, the results to be obtained by  recipients of the products and services described herein, or as to the ability of the S&P 500 indexes to track the performance of the general market or any segment thereof, and shall not in any way be liable for any inaccuracies or errors. Cboe Global Markets, Inc. and its affiliates have not calculated, composed or determined the constituents or weightings of the securities that comprise the S&P 500 indexes and shall not in any way be liable for any inaccuracies or errors.

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We operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible to predict all risks and uncertainties, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

Some factors that could cause actual results to differ include: the loss of our right to exclusively list and trade certain index options and futures products; economic, political and market conditions; compliance with legal and regulatory obligations; price competition and consolidation in our industry; decreases in trading or clearing volumes, market data fees or a shift in the mix of products traded on our exchanges; legislative or regulatory changes or changes in tax regimes; our ability to protect our systems and communication networks from security vulnerabilities and breaches; our ability to attract and retain skilled management and other personnel, including compensation inflation; increasing competition by foreign and domestic entities; our dependence on and exposure to risk from third parties; global expansion of operations; factors that impact the quality and integrity of our indices; our ability to manage our growth and strategic acquisitions or alliances effectively;  our ability to operate our business without violating the intellectual property rights of others and the costs associated with protecting our intellectual property rights; our ability to minimize the risks, including our credit and default risks, associated with operating a European clearinghouse; our ability to accommodate trading and clearing volume and transaction traffic, including significant increases, without failure or degradation of performance of our systems; misconduct by those who use our markets or our products or for whom we clear transactions; challenges to our use of open source software code; our ability to meet our compliance obligations, including managing potential conflicts between our regulatory responsibilities and our for-profit status; our ability to maintain BIDS Trading as an independently managed and operated trading venue, separate from and not integrated with our registered national securities exchanges; damage to our reputation; the ability of our compliance and risk management methods to effectively monitor and manage our risks; restrictions imposed by our debt obligations and our ability to make payments on or refinance our debt obligations; our ability to maintain an investment grade credit rating; impairment of our goodwill, long-lived assets, investments or intangible assets; the impacts of pandemics; the accuracy of our estimates and expectations; litigation risks and other liabilities; and operating a digital asset business and clearinghouse, including the expected benefits of our Cboe Digital acquisition, cybercrime, changes in digital asset regulation, losses due to digital asset custody, and fluctuations in digital asset prices. More detailed information about factors that may affect our actual results to differ may be found in our filings with the SEC, including in our Annual Report on Form 10-K for the year ended December 31, 2022 and other filings made from time to time with the SEC.

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SOURCE Cboe Global Markets, Inc.