• New options on Cboe® iBoxx® iShares® Bond Index futures will provide additional tools to help investors manage exposure and mitigate risk in corporate bond portfolios
• Extending trading to global hours for IBHY and IBIG futures to nearly 24-hours per weekday will help enable investors to more efficiently manage positions around the clock

Cboe Global Markets, the world’s leading derivatives and securities exchange network, announced that it plans to expand its corporate bond index product suite with two new offerings. New options on Cboe® iBoxx® iShares® $ High Yield Corporate Bond Index futures (futures ticker: IBHY) and Cboe® iBoxx® iShares® $ Investment Grade Corporate Bond Index futures (futures ticker: IBIG) are planned to be listed for trading on Cboe Futures Exchange, LLC (CFE) beginning July 10. CFE also plans to extend trading hours for IBHY and IBIG futures to nearly 24-hours per weekday in the third quarter of 2023.

The $10.4 trillionU.S. corporate bond market includes robust cash and exchange-traded fund (ETF) markets, with CFE’s IBHY and IBIG as the only exchange-listed futures products linked to U.S. corporate bonds. Designed to leverage the deep and liquid iShares® ETF ecosystem, CFE’s futures and options on futures products can offer broad coverage of the U.S. corporate bond universe and allow users to hedge and mitigate corporate bond credit risk, and more generally allow them to efficiently allocate to the corporate bond market and implement fixed-income trading strategies.

“We launched IBHY and IBIG futures in 2018 and are pleased to continue our collaboration with BlackRock and IHS Markit, now part of S&P Global, to further grow our corporate bond index offering. These new products and enhanced functionality will provide investors with expanded risk management tools that can help them more effectively manage their credit portfolios,” said Arianne Adams, Senior Vice President, Head of Derivatives and Global Client Services at Cboe Global Markets. “Additionally, the new contracts and expanded trading hours are expected to also enable us to reach and better serve a broader universe of customers. We believe IBHY and IBIG options on futures will allow a wider array of futures market participants to use these products, including those unable to access securities-based options products, while extending trading to global hours for IBHY and IBIG futures will help investors in the U.S. and abroad more efficiently manage positions around the clock.”

“The iBoxx iShares $ Corporate Bond Indices are the latest addition to the benchmarks that comprise the liquid S&P Dow Jones Indices fixed income tradable ecosystem. S&P DJI is pleased with its ongoing collaboration with Cboe and the licensing of its iBoxx high yield and investment grade bond indices as the underlying benchmarks for the exchange’s latest product launch. With its expanded fixed income indexing capabilities through the S&P Global and IHS Markit merger, S&P DJI is able to provide a full suite of index tools to help clients better measure risks and opportunities in the credit markets. This launch also further strengthens the liquid ecosystem of financial products that are already tracking both S&P DJI’s family of equity and fixed income market benchmarks,” said Tim Brennan, Managing Director and Head of Capital Markets at S&P Dow Jones Indices.

Options on IBHY futures (options ticker: IBYO) will be options on the underlying IBHY futures. The price of IBHY futures is based on the iBoxx^® iShares^® $ High Yield Corporate Bond Index (IBXXIBHY Index), which is designed to measure the performance of U.S. dollar-denominated high yield corporate debt.

Options on IBIG futures (options ticker: IBGO) will be options on the underlying IBIG futures. The price of IBIG futures is based on the iBoxx^® iShares^® $ Investment Grade Corporate Bond Index (IBXXIBIG Index), which is designed to measure the performance of U.S. dollar-denominated investment grade corporate debt.

The new IBYO and IBGO options will have American-style exercise, will be physically-settled, will have P.M. settlement and will trade electronically on CFE during regular trading hours, from 9:30 a.m. to 4:00 p.m. ET. Initially, CFE may list for trading options on futures on up to four near-term serial months and four months on the March quarterly cycle for each product. The options on futures will expire on the same day as the underlying futures contract. The contracts will be cleared through OCC and be regulated by the Commodity Futures Trading Commission (CFTC).

The extended trading to global hours is planned for IBHY and IBIG futures only and will cover a 23-hour time period per weekday running Monday through Friday. The extended trading hours session begins the prior day at 6:00 p.m. ET and runs until 9:30 a.m. ET of the current day (trading for the Monday trading day would begin Sunday evening). Regular trading hours run from 9:30 a.m. ET to 4:00 p.m. ET of the current day and are then followed by an extended trading hours session from 4:00 p.m. ET to 5:00 p.m. ET of the current day.

To learn more, visit IBHY/IBIG-Cboe Corporate Bond Index Futures.

Source: Cboe