What’s Driving 24-hour Trading of WTI Opions?… Jeff White

August 28, 2018 by Jim Colburn Leave a Comment

Jeff White, CME, does an excellent job explaining 24-hour trading in WTI options, here…

“At a time when WTI has reemerged as the global oil benchmark, traders outside the U.S. are now able to access a deeper and more liquid WTI options market to execute hedging strategies in their own time zones. This is the result of increased outreach to customers and market users outside the U.S., as well as other efforts by CME Group to build 24-hour liquidity in WTI options. Traders in the marketplace have responded to this and shifting oil fundamentals by increasing trading activity during Asian and European market hours.

Dampened at-the-money implied volatility in 2018 hasn’t stopped the volume growth of WTI options outside of U.S. hours. During European trading, volume is up 10%. Even more impressive, volume during Asian trading up 25%. Unmatched on-screen liquidity means traders can easily access the WTI options markets from any location at any time of day.”

Commodity Research Group (CRG), founded by veteran analyst Edward Meir, is an independent research consultancy specializing in base and precious metals, as well energy products. The Group provides research and general price analysis for these markets, along with advice to companies seeking to construct commodity hedging strategies.

Our associates bring decades of experience to the table, as they seek to help our clients understand the markets. CRG will distill the myriad of pricing variables mentioned above into coherent research that is to-the-point and tailored to a clients hedging or pricing needs. In addition, CRG is available for consulting assignments and speaking engagements. CRG does not manage money or trade for itself.

Reader Interactions

Leave a Reply Cancel reply