CBOE IPO: Flop or Success?

Courtesy of our friends over at ERDesk (www.erdesk.com):

CBOE’s exclusive SPX index options have close substitutes

· CME options on E-mini S&P 500 futures (ES1 options)

· CME options on Standard S&P 500 futures (SP1 options)

· Options on SPDR ETFs (SPY options)

Substitutes altogether account for 31% of notional value traded

An important difference is the size of the contract

Volumes in CBOE exclusive index options are growing modestly

Volumes in options on ETFs, which are traded on multiple exchanges, are substituting for index options -  SPY ETF options are growing at 66% p.a.

Penetration of all S&P500 options has remained flat over the past 3 years at 140% of its underlying value traded