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Cboe Global Markets Launches Options on Three New MSCI Indices


CHICAGOMarch 19, 2024 /7Newswire — Cboe Global Markets, Inc. (Cboe: CBOE), the world’s leading derivatives and securities exchange network, announced it has launched for trading Cboe MSCI World Index Options (MXWLD), Cboe MSCI ACWI Index Options (MXACW), and Cboe MSCI USA Index Options (MXUSA). The launch is part of Cboe’s deepening relationship with MSCI Inc. (MSCI), a leading provider of critical decision support tools and services for the global investment community.

The three new MSCI index options are designed to provide a range of investors exposure to international, developed and emerging markets and U.S. equity market performance. The new Cboe MSCI index options can provide pension funds, insurance companies, and other institutional investors more efficient ways to hedge their global equity exposure, while minimizing potential tracking error and currency risk. Additionally, each of MXWLD and MXUSA is based on a fraction (1/100th) of the value of its underlying index, making these options more accessible for retail investors.

“As more investors seek global equity exposure, adding three new options on MSCI’s world renowned benchmarks was the natural next evolution for Cboe’s suite of index options products,” said Catherine Clay, Head of Global Derivatives at Cboe Global Markets. “Whether investors are looking to hedge their portfolios, generate yields, or make directional trades, we have seen heightened interest in the optionality derivatives can provide. These new index options, and the MSCI volatility benchmark indices launched recently will provide important tools in helping investors manage their global exposures. We look forward to building upon our relationship with MSCI and providing investors the global risk management tools they need.”

For portfolio managers running options overlay strategies, these new index options are designed to allow investors to expand their overlay programs to their global portfolio and thus, diversify the sources of potential income in their portfolio. A potential benefit of overwriting the newly launched MSCI index options include their European-style cash settlement, which helps to eliminate risk of early exercise and physical settlement, two common pain points in running a yield enhancement strategy.

Cboe initially listed MXACW, MXUSA, and MXWLD with standard expiration on the third Friday of each month. Additionally, Cboe plans to list five end-of-week expirations that are expected to begin trading on March 21, 2024. The three new Cboe MSCI Index options are available for trading on the Cboe Options Exchange.

The new index options are in addition to the currently listed Cboe MSCI tradable products, which include Cboe MSCI EAFE Index Options (MXEA) and Cboe MSCI Emerging Markets Index Options (MXEF). Recently, Cboe expanded its suite of volatility indices with the Cboe MSCI EAFE Volatility Index (VXMXEA) and the Cboe MSCI Emerging Markets Volatility Index (VXMXEF). Developed using Cboe’s proprietary VIX® Index methodology, these indices are based on existing MXEA and MXEF options and are designed to provide a transparent measure of the market’s expectation of 30-day implied volatility by these respective MSCI index option classes. Similar to the VIX Index, which is designed to reflect investors’ consensus view of future (30-day) expected U.S. stock market volatility, the new Cboe MSCI Volatility Indices aim to provide comparable measures for international and emerging equity market volatility.

Cboe and MSCI will be hosting a webinar on the key benefits and opportunities provided by the new indices options on Wednesday, March 27. For more information, visit the MSCI Index Options page on the Cboe website.

About Cboe Global Markets, Inc.

Cboe Global Markets (Cboe: CBOE), a leading provider of market infrastructure and tradable products, delivers cutting-edge trading, clearing and investment solutions to market participants around the world. The company is committed to operating a trusted, inclusive global marketplace, providing leading products, technology and data solutions that enable participants to define a sustainable financial future. Cboe provides trading solutions and products in multiple asset classes, including equities, derivatives, FX, and digital assets, across North AmericaEurope and Asia Pacific. To learn more, visit www.cboe.com.

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Any products that have the MSCI Index or Indexes as their underlying interest are not sponsored, endorsed, sold or promoted by MSCI Inc. or Cboe and neither MSCI Inc. nor Cboe make any representations or recommendations concerning the advisability of investing in products that have MSCI indexes as their underlying interests. All other trademarks and service marks are the property of their respective owners.

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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.

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Options involve risk and are not suitable for all market participants. Prior to buying or selling an option, a person should review the  Characteristics and Risks of Standardized Options (ODD), which is required to be provided to all such persons.  Copies of the ODD are available from your broker or from The Options Clearing Corporation, 125 S. Franklin Street, Suite 1200, Chicago, IL 60606. 

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SOURCE Cboe Global Markets, Inc.