VIX October futures, which encompass vote, begin trading Gap between October, September contracts wider than 2020, 2016 Even with the election months away, Wall Street is already beginning to game out the potential impact of a Trump victory, including higher yields, a stronger dollar and a drag on trading partners’ currencies. By Elena Popina January 26, 2024 at 8:59 AM CST Wall Street is more anxious heading into the 2024 US presidential election than it was at this point ahead of the past two votes, judging by one early market indicator. Traders have bid up Cboe VIX October futures, whose underlying S&P 500 options encompass the Nov. 5 vote, since the contract started trading earlier this week, according to data compiled by Bloomberg. The price is now 3.3 points higher than the contract expiring in September. That gap is wider than it was in late January during the 2016 and 2020 election cycles, the data show. The development, highlighted by Rocky Fishman of derivatives analytics firm Asym 500, offers a read into volatility expectations nine months before the vote, which will likely pit President Joe Biden against former president Donald Trump. Trading volume in the October contract is already well above the average level for VIX contracts so far out. “For those investors who do use longer-dated hedges, this is an important event to trade around,” Fishman said by email. Volumes are still “way smaller than what we’ll inevitably see later in the year.” Traders Price in Election Risk Spread between Oct.-Sept. VIX futures exceeds that in 2020 and 2016 Read More: Investors Ramp Up FX Hedges on Mexico Debt as US Election Looms Even with the election months away, Wall Street is already beginning to game out the potential impact of a Trump victory, including higher yields, a stronger dollar and a drag on trading partners’ currencies. The VIX October futures contract traded at 20.8 on Thursday, marginally higher than the October 2020 contract at this point four years ago, but below where it was in January 2016, when stocks were in the middle of a double-digit selloff amid broader economic concerns. The likelihood of a bigger election-related volatility “kink” in the VIX futures curve compared to the previous two elections comes as the VIX Index is trading at a lower base. The gauge hovered near 13.5 on Thursday, compared with 14.6 this time in 2020 and 24.2 in 2016. https://www.bloomberg.com/news/articles/2024-01-26/traders-bid-up-newest-vix-contract-to-hedge-trump-biden-risks?sref=wgRWWeJL&leadSource=uverify wall Graphics didn't paste