The international derivatives exchange Eurex will introduce a so-called mini volatility index future based on VSTOXX. The new futures contract will be launched on 2 June and replace the existing VSTOXX future. In response to customer consultation, the new contract will only carry a multiplier of 100 € per index point whereas the old contract had a multiplier of 1,000 €.
“Our new VSTOXX mini future will allow our users a much better fine-tuning of positions which translates into better hedging opportunities and easier direct exposure”, says Peter Reitz, member of the Eurex Executive Board. “The market potential for volatility futures is huge given the success of volatility derivatives in the US”, he concluded.
Eurex will also support the launch with a special market making scheme in order to ensure order book liquidity from day one. The minimum tick size is 0.05 (5 Euro). Trading hours will be between 9 am and 5:30 pm. Depending on market demand, a VSTOXX option contract will be listed later this year.
D.C.