JLN Options: Options Week in Review Jan. 10, 2013

Jan 10, 2013

Volatility ETFs hit new lows as the VIX index fell to its lowest level since June 20, 2007, ETF Trends reported. Those affected included the iPath S&P 500 VIX Short Term Futures ETN (VXX) and the VelocityShares Daily 2x VIX Short-Term ETN (TVIX). This came after a week in which the VIX index fell a record 39%. Volatility-based products have become hugely popular since the 2008 financial crisis. More than 95% of the call options on VIX futures traded in 2012 expired worthless, according to Yahoo Finance.

Nasdaq OMX Group‘s chief executive Robert Greifeld said he would “definitely” consider bidding for Euronext if ICE decides to spin it off after it completes its acquisition of NYSE Euronext, according to Reuters. Combining Nasdaq and NYSE would have created a virtual monopoly on listings and dominance in trading U.S. cash equities and options. That never happened, but Greifeld pointed out that Euronext does more trading than the London Stock Exchange. Nevertheless, he said he doesn’t feel the need to do an acquisition simply because ICE and NYSE are merging, the Reuters article said.

Optionshop, a new online broker specializing in options on futures, began accepting new accounts. (For the piece we did on Optionshop with its CEO Robert Fizsimmons, go here: http://jlne.ws/RFXw9j)

The International Securities Exchange will shorten the duration of its auctions to half a second from a full second to reduce its members’ exposure to adverse price moves, Traders Magazine reported. The move will also increase the number of auctions it runs.

CBOE announced that its affiliate Market Data Express will launch the CBOE Customized Option Pricing Service (COPS) on Jan. 14.  The new data service offers subscribers end-of-day indicative valuations for “customized” options such as FLEX options and certain OTC options. CBOE also announced a new company-wide branding initiative that includes social media platforms, marketing materials and the company’s web site. It will also be part of a new advertising and marketing campaign. — SR

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