Cboe to list Mini-Russell 2000 Index options in Q1 2021
Market operator and global trading solutions provider Cboe Global Markets, Inc today unveiled its plans to launch trading in Mini-Russell 2000 Index options on Cboe Options Exchange in the first quarter of 2021, subject to regulatory review.
The addition of new mini options on the Russell 2000 Index is in line with Cboe’s continuing expansion of its offerings of smaller-sized, tradable index products that help enable market participants to gain more efficient and cost-effective exposure to the broad U.S. equity market. The planned launch also underscores Cboe’s longstanding relationship with FTSE Russell, building upon its successful franchise of index-based, cash-settled options tied to the FTSE Russell global indices.
New Mini-Russell 2000 Index options (ticker symbol: MRUT) will be structured like standard Russell 2000 Index options, but will feature a smaller contract that is one-tenth the size of the standard contract, making them the same size as comparable ETF options.
The smaller notional value of the mini contract is designed to provide market participants with a more precise way to hedge or gain direct exposure to the Russell 2000 Index. The more manageably sized, P.M.-settled contract is expected to appeal to a diverse range of participants, including sophisticated retail traders and small- or mid-sized institutional investors seeking greater flexibility when managing U.S. small-cap equity market risk and volatility or allocating among accounts.
Alike the standard Russell options, Mini-Russell options will be structured as European-style options (no early exercise) and cash-settled at expiration. Cboe expects the launch of Mini-Russell options to potentially facilitate overall investor participation in the market for Russell 2000 options, which should, in turn, help to further enhance the depth and liquidity of the market to the benefit of investors.