U.S. options trading slowed this month from a record pace after hedge funds collapsed and the biggest market swings since 1929 made equity derivatives too expensive as insurance. About 12.5 million contracts linked to shares changed hands each day in November on average, according to data compiled by Bloomberg. That’s 23% less than in October, the worst month for the Standard & Poor’s 500 Index since 1987, and 13% below the 2008 average, according to Options Clearing Corp., which processes all exchange-listed U.S. options. Trading decreased as hedge funds suffered their worst back- to-back monthly declines in September and October, according to Hedge Fund Research Inc. Costs skyrocketed as the Chicago Board Options Exchange Volatility Index, the key measure of contract prices in the U.S., jumped to the highest level in its 18-year history in October.
Popularity: 1% [?]
