MIAX in Minneapolis – SPIKES Futures to List on MGEX

Spencer Doar

Spencer Doar

Associate Editor

DORAL, FLA. – In the first quarter of 2019, MIAX launched options trading on the SPIKES Index, a competing volatility index to Cboe’s VIX. SPIKES was developed by T3 Index and is based on SPY options instead of SPX options.  

At the 37th Annual Options Industry Conference, T3 Index CEO Simon Ho announced during the “Volatility as an Asset Class” panel that MIAX was partnering with the Minneapolis Grain Exchange (MGEX) to list futures on SPIKES.

Founded in 1881, MGEX is a dogged holdover from the days when regional commodity futures exchanges proliferated. It’s flagship product is hard red spring wheat futures.

Few will disagree with the commonly accepted wisdom that to grow a volatility product you need options AND futures. It had been reported after the SPIKES options debut that MIAX was looking to partner with an existing futures exchange to list those products. Based on side conversations with industry professionals, it seemed unlikely that ICE or CME would enter this fray. Cboe’s futures exchange was clearly not in the picture, and the same goes for Nasdaq’s futures exchange as Nasdaq is developing its own volatility products. That left only a few other players. 

So volatility side by side with the best wheat for bagels? Looks like it could be. (Pending regulatory approval.)

Cboe had this statement to add:

“Cboe welcomes new products that contribute to the development of the volatility space.  Since the introduction of VIX futures and options, many products that have entered the space have helped grow VIX volumes and establish volatility as an asset class.  It is unclear to us, however, how MIAX intends to address the litany of regulatory, operational and clearing requirements needed to launch a viable futures product.  We will continue to monitor these developments and their plans to address these hurdles in the interest of further growing the volatility space.”

MIAX press release HERE. 

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