Everybody Hedging Today Has To Do It In One Place

Everybody hedging the Fed today has to do it in one place.

SPX options and VIX options trade on the Cboe's (CBOE) exchanges and nowhere else.

There's no second venue.

So when 2 p.m. hits and every institution in the country wants index protection, that order flow has exactly one door to go through.

They own the toll booth on fear…

And it's showing up already. June index options volume ran 36.8% above a year ago. Last quarter they put up record net revenue of $671.1 million with adjusted EPS up 46%.

Now look at what we've got in front of us.

Choppy, uncertain trading into the decision, Wells Fargo warning about a sharp decline, and early moves that don't make any sense.

Whatever happens at 2 p.m., somebody's trading it. And every one of those contracts crosses Cboe's book.