Euro-denominated volatility for euro-denominated risk
Mark Shore, author of Eurex Exchange’s new volatility newsletter, is an Adjunct Professor and Board Member of the Arditti Center for Risk Management at DePaul University's Kellstadt Graduate School of Business.
Mark founded the consulting/ research firm Shore Capital Management. He is a frequent speaker at alternative investment events and is a contributing writer for a number of publications including Reuters HedgeWorld and Micro-Cap Review.
Mark graduated from DePaul University with a degree in Finance and holds an MBA from the University of Chicago. He spoke with Eurex Exchange about how VSTOXX products fit a market need for volatility products that focus on Europe, and thus help a wide variety of investors increase their hedging accuracy.
Eurex: Why is volatility as an asset class growing in importance?
Shore: Simply put, investors are becoming more aware of market volatility and the need to hedge their portfolios. Unfortunately, many learned tough lessons in the equity markets in the mid to recent past in terms of the tech and housing bubbles and ensuing crashes and the more recent sovereign debt crisis. Volatility in itself is both a positive and negative phenomenon; negative volatility forces investors to take notice. I explain it in simple terms by likening it to cholesterol levels. No one pays attention until they approach dangerous territory.
Eurex: What factors will drive the VSTOXX market going forward?
Shore: First and foremost, ongoing market volatility will drive the future development of the VSTOXX market. As awareness of volatility grows, investors are learning that professional traders are not the only market participants that can use volatility products to better hedge. Education plays an important role in this process. While professional traders can and do utilize volatility products to hedge, smaller investors can access many of the same volatility products, including either by directly taking a view with volatility futures or by way of managed accounts. One important way that volatility as an asset class will gain further traction is through continued educational efforts.
Eurex: Are geopolitical developments causing investors to diversify their volatility portfolios?
Shore: READ MORE
Follow Mark Shore on Twitter, Facebook and Linkedin
Check out our VSTOXX research page
Mark Shore, author of Eurex Exchange’s new volatility newsletter, is an Adjunct Professor and Board Member of the Arditti Center for Risk Management at DePaul University's Kellstadt Graduate School of Business.
Mark founded the consulting/ research firm Shore Capital Management. He is a frequent speaker at alternative investment events and is a contributing writer for a number of publications including Reuters HedgeWorld and Micro-Cap Review.
Mark graduated from DePaul University with a degree in Finance and holds an MBA from the University of Chicago. He spoke with Eurex Exchange about how VSTOXX products fit a market need for volatility products that focus on Europe, and thus help a wide variety of investors increase their hedging accuracy.
Eurex: Why is volatility as an asset class growing in importance?
Shore: Simply put, investors are becoming more aware of market volatility and the need to hedge their portfolios. Unfortunately, many learned tough lessons in the equity markets in the mid to recent past in terms of the tech and housing bubbles and ensuing crashes and the more recent sovereign debt crisis. Volatility in itself is both a positive and negative phenomenon; negative volatility forces investors to take notice. I explain it in simple terms by likening it to cholesterol levels. No one pays attention until they approach dangerous territory.
Eurex: What factors will drive the VSTOXX market going forward?
Shore: First and foremost, ongoing market volatility will drive the future development of the VSTOXX market. As awareness of volatility grows, investors are learning that professional traders are not the only market participants that can use volatility products to better hedge. Education plays an important role in this process. While professional traders can and do utilize volatility products to hedge, smaller investors can access many of the same volatility products, including either by directly taking a view with volatility futures or by way of managed accounts. One important way that volatility as an asset class will gain further traction is through continued educational efforts.
Eurex: Are geopolitical developments causing investors to diversify their volatility portfolios?
Shore: READ MORE
Follow Mark Shore on Twitter, Facebook and Linkedin
Check out our VSTOXX research page
RSS Feed