Cboe Unveils Bundled VIX Future-Option Orders for Traders
Published Date: 1/16/2026
Notice
Summary
Cboe Exchange is rolling out a new way to trade by letting investors bundle VIX options and VIX futures into one order, making it easier and faster to manage their strategies. This change affects traders who use these products and could save them time and money by simplifying their trades. The new rule is up for review now, so keep an eye out for when it officially launches!
Analyzed Economic Effects
7 provisions identified: 4 benefits, 3 costs, 0 mixed.
Bundle VIX Options and VX Futures
The Exchange proposes a new future-option order that lets you submit VIX options and related VX futures as one packaged order (initially only VIX options and VX futures). This is intended to let investors price and execute the whole package together and reduce execution, legging, and price-drift risk when trading these strategies.
Mandatory Risk-Offset Delta Limits
To enter a VIX future-option order, each grouped future-and-option component must meet a risk offset requirement: the future leg(s) must offset the option leg(s) by no less than 10% and no greater than 125% (expressed as a delta between -0.10 and -1.25). The System will reject orders that cannot be properly grouped.
Must Be CFE Member or Use Designated FCM/IB
If you are also a member of CFE, the Exchange will send the futures leg to CFE on your behalf. If you are not a CFE member, you must designate an FCM or introducing broker (FCM/IB) with which you have an agreement and which the Exchange has identified to receive and route the futures component to CFE.
Execution Only If Futures Also Execute
A future-option order will execute only if both the option component(s) and the specified futures component(s) can execute. If the Exchange receives a report that the futures component(s) cannot execute, the Exchange will nullify the option component(s) and notify the user (the nullification is automatic for immediate failures).
Listed Alternative to OTC; More Transparency
The Exchange says future-option orders may provide an exchange-listed alternative to trading certain option/futures combos over-the-counter (OTC), and could shift liquidity from the OTC market to listed markets, increasing market transparency, price discovery, and clearing (contra-party creditworthiness) for these strategies.
Pricing Increments and Customer Protections
Future-option orders may express option bids/offers in decimals the Exchange determines (option leg minimum increment $0.01 or greater), and futures legs may trade in the decimal increments permitted by the designated contract market (the filing notes VX futures currently trade in 0.05 index-point increments). Option legs of future-option orders are subject to the same priority and execution price protections as other complex orders (e.g., cannot execute at prices worse than simple-book component prices or certain SBBO protections).
Time-in-Force Limited to Day or IOC
A future-option order submitted for electronic processing may only be Day (expires at market close if not executed) or IOC (immediate-or-cancel); it may not be submitted as GTC (good-til-cancelled) or GTD (good-til-date).
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Key Dates
Department and Agencies
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