Robinhood Options Expand with Cboe’s Index Options

In a significant development for retail investors, Cboe Global Markets (BATS: CBOE) and Robinhood Markets Inc. (NASDAQ: HOOD) have announced a collaboration that will see Cboe's index options, including prominent instruments such as the S&P 500 Index options and VIX options, being introduced on Robinhood's platform.

This move heralds a new era for Robinhood users, providing them with new avenues for trading capabilities that enable broad U.S. market exposure, hedging strategies against volatility, generating income, and capitalising on market movements.

The suite of index options that will become available on Robinhood includes the much-tracked S&P 500 Index options, VIX options related to market volatility, Russell 2000 Index options for small-cap exposure, and Mini SPX options which offer a compact form of S&P trading. These instruments are well-known for their benefits like cash-settlement and European-style exercise mechanism, which collectively offer increased flexibility and reduced risk profiles suitable for investors of varying levels of experience.

Dave Howson, Global President at Cboe Global Markets, emphasized that this initiative is in tune with the growing sophistication of retail investors. It is expected that the addition of Cboe's index options on Robinhood will powerfully augment retail trading strategies. According to Howson, today's retail traders are well-versed in market dynamics and demand tools that resonate with their advanced understanding and strategies.

Echoing the sentiment of connecting retail investors with professional-grade trading solutions, Steve Quirk, Chief Brokerage Officer at Robinhood, mentioned that the introduction of index options is a direct response to customer demand. He highlighted that Robinhood’s mission is to democratize finance for all, and this new offering is a step toward empowering investors with more sophisticated and innovative trading options.

Adding to the dimensions of this dynamic partnership, Catherine Clay, Global Head of Derivatives at Cboe Global Markets, spotlighted the growing trend amongst investors of employing options for a gamut of strategies – ranging from risk management to capitalizing on market swings. Cboe is committed to providing robust access to a rich options trading environment, catering to the evolving needs of the market participants.

The launch of Cboe index options on Robinhood is set to greatly enhance the investment portfolio options for retail traders. These new trading instruments fulfill a critical role in enabling investors to tap into wider market movements, manage risks more effectively, and engage in more advanced trading strategies. Both Cboe and Robinhood are aligned in their vision to cater to the ascending demand for more sophisticated trading tools among retail investors, marking a new chapter in democratizing financial instruments that were traditionally the domain of more advanced traders.