← The Derivative18 jun · 1 u 17 min
How Chicago Became the World’s Options, Vol, and Derivatives Capital (with Cboe’s Rob Hocking & Mandy Xu)
<p>On this episode of The Derivative, Jeff Malec continues Chicago Month with a deep dive into the past, present, and future of derivatives and volatility at Cboe with two of its stars. </p><p>First up, Cboe Global Head of Derivatives Rob Hocking traces Chicago’s rise as the world’s derivatives hub, from the Board of Trade’s agricultural hedging roots to SPX and VIX becoming the center of global risk transfer. Rob walks through life in the OEX and SPX pits, the culture of open outcry, the evolution from Hull and DRW to “the dark side” at the exchange, and how today’s liquidity, zero‑DTE flows, and concentrated market‑making still hold up under stress. He and Jeff dig into whether the derivative can ever outgrow the underlying, why S&P 500 remains the benchmark despite megacap concentration and global basis risk, and how Cboe balances the floor’s high‑touch block business with a mostly electronic market.</p><p>Then Mandy Xu, Head of Derivatives Market Intelligence at Cboe, joins to break down the current volatility regime. She explains what VIX really measures (and why “fear gauge” is often wrong), how Cboe decomposes VIX into bullish vs bearish positioning, and why today’s record call‑chasing and low skew feel uncomfortably close to meme‑stock and late‑’90s territory. Mandy covers the rise of zero‑DTE, option‑income and buffered ETFs, the breakdown of stock–bond correlation, the AI‑driven dispersion trade, and whether vol selling is truly “artificially” suppressing risk. The trio also find time for some Chicago vs New York banter—pizza, skylines, seasons, and sports—and a look at what’s next from Cboe, from binaries on XSP to trading KPI‑style “valuation chain” products tied to names like Tesla and Cboe itself.</p><p><br><strong>00:00-01:43=Intro</strong></p><p><strong>01:44–05:36 = From Corn Contracts to Options Hub</strong></p><p><strong>05:37–20:42 = Pit Sheets to $5 Trillion a Day: Inside the S&P Options Machine</strong></p><p><strong>20:43–30:29 = Game Within the Game</strong></p><p><strong>30:30–35:36 = Big Blocks, Complex Trades, and the Future Beyond VIX</strong><strong>38:07-42:15 = Pork Chops at Soldier Field</strong></p><p><strong>42:16–51:09 = Retail Flows and the New Vol Regime</strong></p><p><strong>51:10–1:02:57 = Is VIX Still the Fear Gauge? What’s Really Driving Risk</strong></p><p><strong>1:02:58-1:07:18 = AI Winners, Dispersion, and the 60/40 Shift</strong><strong>1:07:19-1:13:16 = Building Better Hedges</strong></p><p><strong>1:13:16-1:17:34 = Chicago vs. New York: Pizza, Seasons, Sports, & Final Whistle</strong></p><p><br>From the Episode:<a href="https://www.rcmalternatives.com/2013/12/blast-from-the-past-how-futures-saved-stocks/" target="_blank" rel="noopener noreferer"><strong>How Futures saved Stocks </strong></a></p><p><a href=" https://info.rcmalternatives.com/vix-whitepaper-2025-update" target="_blank" rel="noopener noreferer"><strong>RCM VIX Whitepaper</strong></a></p><p><a href="https://www.rcmalternatives.com/2019/02/throwback-thursday-vixmaggaedon/" target="_blank" rel="noopener noreferer"><strong>Blog Post - VIXmaggaeddon </strong></a></p><p><br>Follow along with <a href="https://www.linkedin.com/in/rob-hocking-7a1831a/" target="_blank" rel="noopener noreferer">Rob Hocking</a>, <a href="https://www.linkedin.com/in/mandy-xu-bb638617/" target="_blank" rel="noopener noreferer">Mandy Xu</a>, and the <a href="https://www.linkedin.com/company/cboe/" target="_blank" rel="noopener noreferer">Cboe </a>on LinkedIn and be sure to visit <a href="https://www.cboe.com/" target="_blank" rel="noopener noreferer">cboe.com</a> for more information!</p><p>Don't forget to subscribe to<a href="https://www.rcmalternatives.com/the-derivative-podcast/">The Derivative</a>, follow us on Twitter at<a href="https://twitter.com/rcm
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