This video provides a background for CBOE VOLATILITY INDEX® (VIX®) option contracts. Below are some of the product specifications from the Chicago Board Options Exchange. For more information please review VIX Product Specifications on CBOE.com. Description: The CBOE Volatility Index - more commonly referred to as "VIX" - is a market estimate of expected volatility that is calculated by using S&P 500® Index (SPX) option bid/ask quotes. VIX uses nearby and second nearby options with at least 8 days left to expiration and then weights them to yield a constant, 30-day measure of the expected volatility of the S&P 500 Index. Expiration Date of the Contracts: The Wednesday that is thirty days prior to the third Friday of the calendar month immediately following the expiring month. Exercise Style of the Contracts: European - CBOE Volatility Index options generally may be exercised only on the Expiration Date. Last Trading Day for the Contracts: The Tuesday prior to the Expiration Date of each month. Trading Hours for the Contracts: 8:30 a.m. to 3:15 p.m. Central Time (Chicago time). CBOE Volatility Index options will not open until the SPX opening rotation is completed. Regards, Brian Overby TradeKing Options Guy and Senior Option Analyst www.tradeking.com Follow Brian on Twitter or visit TradeKing on Facebook and YouTube. Brian Overby does not hold positions in any securities mentioned in the video. Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options available at http://www.tradeking.com/ODD. Videos are provided for educational and informational purposes only. All investments involve risk, losses may exceed the principal invested, and the past performance of a security, industry, sector or financial product does not guarantee future results or returns. TradeKing provides self-directed investors with discount brokerage services, and does not make recommendations or offer investment, financial, legal or tax advice While implied volatility represents the consensus of the marketplace as to the future level of stock price volatility or probability of reaching a specific price point there is no guarantee that this forecast will be correct. (c) 2012 TradeKing Group, Inc. Securities through TradeKing, LLC. All rights reserved. Member FINRA and SIPC.
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Duration: 6m 39s
Rating: 14