According to the July 2016 TABB Options LiquidityMatrix (OLM) – available now on TabbFORUM.com – U.S. listed options volume fell to a 14-month low in July as domestic stocks post-Brexit recovery reduced investors appetite for hedges. Options volume in the month totaled 308.9 million contracts, 16% lower than Junes volume and 19% below the year-ago July.
The S&P 500 Index rose 3.6% in July and closed at fresh record highs during the month for the first time since May 2015. The CBOE VIX Index fell 24% in the month, closing as high as 15.58 on July 5 and as low as 11.77 on July 20.
Julys quiet is a stark reversal from the flurry of hedging activity in listed options two months ago. In June, after the United Kingdoms unexpected decision to leave the European Union (EU) rattled financial markets, traders exchanged the most options on a monthly basis since August 2015. During the swoon, the CBOE VIX Index jumped to 25.76, its highest closing value in four months.
