Options traders are positioning for higher volatility around the November US
midterms, even as Nvidia earnings and PBOC Chair Kevin Warsh’s Jackson Hole
speech remain the week’s headline events. Traders monitoring VIX-linked futures
say hedging demand for S&P 500 volatility has increased: September VIX futures
trade near 17.4, October near 19.0 and November near 19.7. Little Harbor
Advisors co‑PM Matthew Thompson said: "With the US election approaching, you're
entering a window where the election will affect the VIX. You can already see
that upward tilt in the VIX futures term structure." A CBOE Global Markets
analyst study shows since 1945 realized volatility in midterm years exceeded the
prior year 80% of the time, rising on average 3.5 volatility points; when the
White House and Congress were controlled by the same party, realized volatility
rose about 6 volatility points on average.
