Asian volatility indexes too illiquid to hedge risk
Asia’s volatility products are not yet liquid enough to draw local investors away from the CBOE Vix
Recently launched volatility index futures markets on the Hong Kong and Osaka exchanges do not yet have enough liquidity and so Asian investors are still using the Chicago Board Options Exchange (CBOE) Vix-based products instead.
Volatility futures tracking the Hang Seng index in Hong Kong (V-HSI) and Japan’s Nikkei 225 (V-Nikkei) were launched in February this year – eight years after the CBOE Vix futures came onto the market. But so far liquidity has been lower on the Asian indexes than in Vix
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