Month of higher vol spurs equity derivatives trading

Turmoil benefits total return futures, cross-asset arbitrage and dispersion

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Dealers are reporting a surge in activity for some types of trade as volatility has reappeared
Infopro Digital montage

The first sustained bout of equity volatility in more than two years is raising investors’ hopes of a better trading environment – even though thin liquidity made some early dislocations all but untradeable.

A month after its February 5 spike, the Vix index of S&P 500 volatility continues to bounce around in the high teens and low 20s. It had been trading below 10 points in early January.

“We see this as a longer-term shift in regime for volatility and correlation,” says a portfolio manager at

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