In this article we speak with Gabriel Manceau, an equity derivatives trader for Barclays Capital and market maker in VSTOXX® Futures. We asked him why European focused volatility products are a logical choice both for those looking to hedge European volatility and to trade the product. An active trader of VSTOXX® Futures, he provides the perspective of someone who sees the flow first hand, and hears the conversation about volatility futures on a daily basis.
Mark Shore: How important are European volatility products for investors and why?
Gabriel Manceau: Europe is one of the most actively traded markets. If investors have European exposure they should definitely be looking at European volatility products such as VSTOXX® Futures. The most precise and relative way to hedge European exposure to volatility is by trading European volatility products.
Mark Shore: Is the market ripe for European volatility products?
Gabriel Manceau: There has been and continues to be an increase of investment capital into Europe. Thus the need for European related volatility products increases alongside this greater exposure for European investments. Since the financial crisis, hedging volatility has become a major theme of risk management for many investors. Therefore the increased demand for European volatility hedging coupled with easy to access volatility products makes the timing “ripe”.
Mark Shore: Can VSTOXX® Futures compliment other financial products? If so, what are a few examples?
Gabriel Manceau: VSTOXX® Futures are the cleanest way to play European volatility, in the sense that READ MORE
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Copyright ©2014 Mark Shore. Contact Mark Shore for permission for republication at email@example.com Mark Shore has more than 25 years of experience in the futures markets and managed futures, publishes research, consults on alternative investments and conducts educational workshops. www.shorecapmgmt.com
Mark Shore is also an Adjunct Professor at DePaul University’s Kellstadt Graduate School of Business, where he teaches the only known accredited managed futures course in the country. He is also a Board Member of the Arditti Center for Risk Management at DePaul University.
Past performance is not necessarily indicative of future results. There is risk of loss when investing in futures and options. Futures and options can be a volatile and risky investment; only use appropriate risk capital; this investment is not for everyone. The opinions expressed are solely those of the author and are only for educational purposes. Please talk to your financial advisor before making any investment decisions.