Cboe Exchange, Inc. has proposed a change to its rules to allow certain index options, known as expiring non-Volatility A.M.-settled index options, to be traded up until their settlement value is determined on the expiration date. Currently, these options stop trading the day before the expiration day, which increases overnight risk for investors. The change would allow more trading opportunities to manage risk efficiently, especially during night trading sessions. The proposed rule aligns the trading hours of Cboe's options with similar products from other exchanges, aiming to enhance trading flexibility and risk management for investors.
Simple Explanation
Cboe Exchange wants to change a rule so people can trade certain options for a longer time until their final value is known, making it easier for them to manage risks. This change is supposed to give traders more chances to buy and sell these options, making it fair like other trading places do.