Recap of Cboe’s Risk Management Conference 2024

The Cboe Risk Management Conference (RMC) 2024, held from October 15-18 in the breathtaking Snowbird, Utah, brought together traders, investors, strategists, and researchers to explore the latest products and strategies for managing risks, enhancing yields, and managing volatility. This year’s conference was a melting pot of insightful discussions, innovative ideas and networking opportunities. 

RMC 2024 Attendee Breakdown

Day 1: ETF-Centric  

The first day of RMC 2024 was dedicated to the burgeoning exchange traded fund (ETF) industry, with three panels focusing on covered call, fixed income, and buffered ETFs. The discussions highlighted the impressive growth of derivatives-based income funds, particularly covered call ETFs, which have seen assets soar to $80 billion by Q3 2024. This growth is driven by the increasing portfolio needs of retirees and those nearing retirement. 

Fixed income ETFs were also in the spotlight, with panelists discussing the ongoing modernization of the fixed income market. Despite advancements in electronic trading, only a quarter of all trading activity is electronic, indicating significant room for growth and modernization. 

The day concluded with a session on buffered ETFs, which offer defined investment outcomes with downside protection and capped upside participation. The use of FLEX® options in these funds has driven a significant increase in FLEX volumes since 20222. 

Day 2: Derivatives Deep Dive 

Day 2 of RMC 2024 kicked off with a warm welcome from Catherine Clay, Global Head of Derivatives at Cboe Global Markets^®. Her opening remarks set the stage for a day packed with insightful presentations and engaging panel discussions. 

Morning Sessions 

The day began with a brief kickoff from the emcee, Nishank Modi, Senior Director at Cboe Global Markets, who energized the audience for the sessions ahead. 

Trading Volatility Risk Premium Strategies: Chris Rodarte, Managing Director at DGV Solutions, delivered an enlightening presentation on strategies for trading the volatility risk premium. His insights into the nuances of these strategies provided valuable takeaways for attendees looking to enhance their trading approaches. 

Hedging Reality: Are Traditional Measures of Volatility Too Slow in the 0DTE World?: This panel, moderated by Nishank Modi, featured Dennis Davitt (CEO, Millbank Dartmoor Portsmouth), Euan Sinclair (Portfolio Manager, Hull Tactical), and Jay Pestrichelli (CEO, ZEGA Financial). The discussion delved into the challenges and opportunities of hedging in a world dominated by zero days to expiration (0DTE) options, highlighting the need for more responsive volatility measures. 

After a productive networking break, the conference resumed with a panel on Leveraging Derivatives Across Fund Wrappers. Moderated by Kristin Boyd, Global Head of Derivatives Sales and Distribution at Cboe, the panel included Michael Zaslavsky (Senior Investment Strategist, Parametric) and Graham Day (CIO, Innovator Capital Management). The discussion focused on the innovative use of derivatives within various fund structures to achieve diverse investment objectives. 

Midday Highlights 

A fireside chat on The Future of Global Retail Client Trading featured Cathy Clay, EVP and Global Head of Derivatives at Cboe, and JJ Kinahan, CEO of IG North America (tastytrade). Their conversation provided a forward-looking perspective on the evolving landscape of retail trading and the increasing sophistication of retail investors. 

Following a networking lunch, the afternoon sessions began with a panel discussion about Indexing and its Role in Innovating the Investment Landscape. Moderated by Caleb Silver, Editor-In-Chief of Investopedia, the panel brought together industry leaders Dan Draper (CEO, S&P Dow Jones Indices), Ron Bundy (President, Morningstar Indexes), Tom Jenkins (Global Head of Index Partnerships and Listed Derivatives, FTSE Russell), and Jana Haines (Head of Index, MSCI). They discussed the transformative impact of indexing on investment strategies and market dynamics. 

Afternoon Insights 

The keynote on US Politics & Election Outlook by John Harwood, an award-winning journalist and former CNN White House Correspondent, provided a timely analysis of the political landscape and its implications for the markets. This was followed by Ed Tom’s presentation on What’s Priced in for U.S. Elections, offering a deep dive into market expectations and potential scenarios as the November 5th elections approach. 

After another networking break, the focus shifted to The Art of Trading Dispersion. Moderated by Noel Smith, CIO of Convex Asset Management, the panel featured Ryan McRandal (Deputy CIO, One River Asset Management) and Roxton McNeal (Managing Director & Head PM QIS Investments, Simplify). The discussion explored strategies for trading dispersion and the opportunities it presents in the current market environment. 

The final panel of the day, Upstairs / Downstairs: How Liquidity Formation Happens Across the U.S. Options Markets, was moderated by Cem Karsan, Founder & CIO of Kai Volatility Advisors. Panelists Bill Looney (Head of Global Business Development, X-Change Financial Access), Tim Knowles (Partner, Carrick Lane), and Jason Roelke (Head of Institutional Equity Derivative Sales, Citadel Securities) provided insights into the mechanics of liquidity formation and the interplay between different market participants. 

Evening Networking 

The day concluded with a networking cocktail hour sponsored by S&P Dow Jones Indices, followed by a dinner hosted by Cboe. These events provided attendees with the opportunity to unwind, network, and discuss the day’s insights in a more informal setting. 

Day 2 of RMC 2024 was a resounding success, offering a wealth of knowledge and networking opportunities. As the conference continues, attendees look forward to more engaging sessions and valuable takeaways. 

Day 3: Trading Dispersion and Volatility 

Day 3 of the Cboe Risk Management Conference (RMC) 2024 continued to deliver valuable insights and forward-thinking discussions, focusing on advanced trading strategies and innovative volatility products. 

Morning Sessions 

The day began with a presentation on Trading Realized Dispersion by Rick Sandulli, Co-CEO of Metaurus Advisors, and John Hiatt from Cboe Labs. They explored the intricacies of realized dispersion trading, providing attendees with a deep understanding of how to capitalize on the differences in volatility among various assets. Their insights into the practical applications and benefits of dispersion trading were particularly enlightening for those looking to diversify their trading strategies. 

Following this, Robert Hocking, Global Head of Product Innovation at Cboe Global Markets, took the stage to discuss The Next Generation of Volatility Products. Hocking’s presentation highlighted the latest advancements in volatility products, emphasizing how these innovations can help traders and investors better manage risk and enhance returns. His forward-looking perspective on the evolution of volatility products underscored the importance of staying ahead of market trends and adapting to new tools and strategies. 

Key Takeaways 

Day 3 of RMC 2024 was a testament to the conference’s commitment to providing cutting-edge content and fostering a deeper understanding of complex trading strategies. The presentations offered a blend of theoretical knowledge and practical insights, equipping attendees with the tools they need to navigate the ever-evolving financial landscape. 

There are important risks associated with transacting in any of the Cboe Company products discussed here. Before engaging in any transactions in those products, it is important for market participants to carefully review the disclosures and disclaimers contained at: https://www.cboe.com/us_disclaimers/. These products are complex and are suitable only for sophisticated market participants. These products involve the risk of loss, which can be substantial and, depending on the type of product, can exceed the amount of money deposited in establishing the position. Market participants should put at risk only funds that they can afford to lose without affecting their lifestyle. © 2024 Cboe Exchange, Inc. All Rights Reserved.