Cboe to Launch High Yield Futures

Cboe Plans September 10 Launch of U.S. High Yield Corporate Bond Index Futures Trading

CHICAGO – August 24, 2018 – Cboe Global Markets, Inc. (Cboe: CBOE | Nasdaq: CBOE), one of the world’s largest exchange holding companies, today announced that Cboe Futures Exchange (CFE), plans to offer trading in Cboe® iBoxx® iShares® $ High Yield Corporate Bond Index (IBHY) futures beginning September 10, 2018, pending regulatory review.

The $8.5 trillion U.S. corporate bond market includes robust cash and exchange-traded fund (ETF) markets, however, there is currently no exchange-listed futures product linked to U.S. corporate bonds. Cboe IBHY futures are based on a broad-based U.S. high yield corporate bond index and are expected to bring additional liquidity and price transparency to the marketplace. The futures will allow users to hedge and mitigate high yield corporate bond credit risk, and more generally allow them to efficiently allocate to the corporate bond market and implement fixed-income trading strategies.

Chris Concannon, Cboe President and Chief Operating Officer, said: “Cboe’s product innovation expertise has created the infrastructure necessary to transform corporate bond index futures from product idea to tradable reality. Cboe IBHY futures will offer exposure to the U.S. high yield corporate bond market, providing customers with a convenient, standardized vehicle for fixed-income trading.”

The price of Cboe’s IBHY futures is based on IHS Markit’s iBoxx® iShares® $ High Yield Corporate Bond Index (IBXXIBHY Index). Leveraging the deep and liquid iShares® ETF ecosystem, the IBXXIBHY Index is designed to measure the performance of U.S. dollar-denominated high-yield corporate debt, and offers broad coverage of the liquid U.S. high yield corporate bond universe.

Cboe IBHY futures will be cash-settled with a $1,000 multiplier and trade electronically on CFE during regular trading hours (8:30 a.m. to 3:15 p.m. CT). The contracts will be cleared through the Options Clearing Corporation (OCC) and regulated by the Commodity Futures Trading Commission (CFTC).

To learn more about Cboe IBHY futures, including contract specifications, product fact sheet and historical IBXXIBHY Index performance, visit http://cfe.cboe.com/cfe-products/ibhy.

Related articles

  1. July 4 week may not be so slow after all.

    Nearly a dozen retail brokers have joined to evaluate how market infrastructure and rules should evolve.

  2. The exchange's Bitcoin ETN future is most likely not going to be its last.

  3. Fixed Income Liquidity to Become More Centralized

    Clients will have the ability to interact with a larger liquidity pool while minimizing market impact.

  4. The exchange's derivatives segment will close for trading on Friday 28 January 2022.

  5. Exchange group aims to support new markets for digital assets, cryptocurrencies and NFTs.