VIX Index options are some of the most actively traded options in the world. However, VIX options have a very different settlement process compared to standard equity options.
In this video, you’ll learn exactly how the VIX options/futures settlement process works.
Here are the three biggest nuances related to VIX options expiration:
1) VIX options are A.M. settled, not P.M. settled like equity options.
2) VIX options DO NOT receive their settlement value based on the VIX Index.
3) VIX options are cash-settled at settlement as there are no “VIX shares” for the options to settle to.
The examples and explanations in this video will help you develop a firm understanding of the VIX options settlement process.
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