Cboe, IHS Markit and BlackRock Join Forces to Launch First U.S. Corporate Bond Index Futures
- Alliance expected to expand ecosystem around the iShares iBoxx $ High Yield Corporate Bond ETF and the iShares iBoxx $ Investment Grade Corporate Bond ETF
CHICAGO, May 16, 2018 /PRNewswire/ -- Cboe Global Markets, Inc. (Cboe: CBOE | Nasdaq: CBOE), one of the world's largest exchange holding companies, today announced a collaboration with IHS Markit Ltd. (Nasdaq: INFO) and BlackRock, Inc. (NYSE: BLK), for Cboe to develop the first-ever broad-based U.S. corporate bond index futures.
The new futures' groundbreaking design will leverage the deep and liquid iShares ETF ecosystem and iBoxx index expertise to create exchange-listed products that are designed to reflect the performance of the broad U.S. high yield and investment grade bond markets. The futures are expected to provide liquid hedging vehicles for institutional investors with exposure to U.S. corporate debt, and will be listed and traded on Cboe Futures Exchange, pending regulatory review by the U.S. Commodity Futures Trading Commission (CFTC).
Chris Concannon, Cboe President and Chief Operating Officer, said: "Cboe is thrilled to partner with IHS Markit and BlackRock to create the first index futures benchmarked to a diverse array of U.S. corporate bonds. We are especially excited by the ongoing opportunities we see in leveraging the expertise of IHS Markit in indices and BlackRock's branding and market leadership in fixed-income ETFs. We believe this will provide our customers with a tool to mitigate credit risk in the corporate bond market."
Aram Flores, Managing Director and Global Head of Indices at IHS Markit, said: "IHS Markit is delighted to join forces with Cboe and BlackRock in expanding the ecosystem of tradable instruments that reference iBoxx indices. We believe these contracts will bring additional liquidity to the fixed-income space, while providing investors with broad coverage to hedge against risk."
Martin Small, Head of U.S. iShares at BlackRock said: "Index instruments are foundational elements of orderly and efficient markets and these index futures are a quantum leap forward towards better bond markets. A growing ecosystem of market access vehicles, chiefly bond ETFs and bond index futures are a critical step towards improving the price transparency and liquidity of corporate bond markets."
Cboe expects to begin launching products in the summer of 2018, starting with the high yield corporate bond index futures. This allows a greater share of global market participants to access the $8.5 trillion U.S. corporate bond market through exchange-traded, centrally cleared instruments.
The index futures will be designed to reflect the performance of new IHS Markit iBoxx indices, which will include the publicly disclosed eligible holdings of the iShares iBoxx $ High Yield Corporate Bond ETF and the publicly disclosed eligible holdings of the iShares iBoxx $ Investment Grade Corporate Bond ETF. iBoxx corporate bond indices from IHS Markit provide a benchmark for active and passive investors, which is determined by multi-source pricing data, as well as analytical views on the sector, rating, maturity and size of constituent bonds.
About Cboe Global Markets, Inc.
Cboe Global Markets, Inc. (Cboe: CBOE | Nasdaq: CBOE) is one of the world's largest exchange holding companies, offering cutting-edge trading and investment solutions to investors around the world. The company is committed to relentless innovation, connecting global markets with world-class technology, and providing seamless solutions that enhance the customer experience.
Cboe offers trading across a diverse range of products in multiple asset classes and geographies, including options, futures, U.S. and European equities, exchange-traded products (ETPs), global foreign exchange (FX) and multi-asset volatility products based on the Cboe Volatility Index (VIX Index), the world's barometer for equity market volatility.
Cboe's trading venues include the largest options exchange in the U.S. and the largest stock exchange by value traded in Europe. In addition, the company is the second-largest stock exchange operator in the U.S. and a leading market globally for ETP trading.
The company is headquartered in Chicago with offices in Kansas City, New York, London, San Francisco, Singapore, Hong Kong and Quito, Ecuador. For more information, visit www.cboe.com.
About IHS Markit
IHS Markit (Nasdaq: INFO) is a world leader in critical information, analytics and solutions for the major industries and markets that drive economies worldwide. The company delivers next-generation information, analytics and solutions to customers in business, finance and government, improving their operational efficiency and providing deep insights that lead to well-informed, confident decisions. IHS Markit has more than 50,000 business and government customers, including 80 percent of the Fortune Global 500 and the world's leading financial institutions.
The iShares ETFs upon which certain of the new iBoxx ETF Indexes ("the Indices") are based, are distributed by BlackRock Investments, LLC (together with its affiliates, "BlackRock"). BlackRock does not make any warranty regarding the Indices. This material should not be construed as research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities, including any iShares ETFs, or to adopt any investment strategy. BlackRock is not affiliated with IHS Markit or Cboe Global Markets, Inc. iSHARES and BLACKROCK are registered trademarks of BlackRock. All other marks are the property of their respective owners.
Carefully consider the iShares ETFs' investment objectives, risk factors, and charges and expenses before investing. This and other information can be found in the iShares ETFs' prospectuses or, if available, the summary prospectuses which may be obtained by visiting www.iShares.com or www.blackrock.com. Read the prospectus carefully before investing. The iShares ETFs are not sponsored, endorsed, issued, sold or promoted by Markit Indices Limited, nor does this company make any representation regarding the advisability of investing in the iShares ETFs. BlackRock is not affiliated with Markit Indices Limited.
BlackRock helps investors build better financial futures. As a fiduciary to our clients, we provide the investment and technology solutions they need when planning for their most important goals. As of March 31, 2018, the firm managed approximately $6.317 trillion in assets on behalf of investors worldwide. For additional information on BlackRock, please visit www.blackrock.com.
Cboe®, Cboe Volatility Index® and VIX® are registered trademarks and Cboe Global MarketsSM is a service mark of Cboe Exchange, Inc. All other trademarks and service marks are the property of their respective owners.
Cboe Global Markets, Inc. and its affiliates do not recommend or make any representation as to possible benefits from any securities or investments, or third-party products or services. Cboe Global Markets, Inc. is not affiliated with BlackRock or IHS Markit. Investors should undertake their own due diligence regarding their securities and investment practices. This press release speaks only as of this date. Cboe Global Markets, Inc. disclaims any duty to update the information herein.
Nothing in this announcement should be considered a solicitation to buy or an offer to sell any securities in any jurisdiction where the offer or solicitation would be unlawful under the securities laws of such jurisdiction. Nothing contained in this communication constitutes tax, legal or investment advice. Investors must consult their tax adviser or legal counsel for advice and information concerning their particular situation.
IHS Markit and its affiliates make no warranty, expressed or implied, including, without limitation, any warranties as of merchantability, fitness for a particular purpose, accuracy, completeness or timeliness, or as to the results to be obtained by recipients of the products and services described herein, and shall not in any way be liable for any inaccuracies, errors. "IHS Markit" and "iBoxx" are registered trademarks of IHS Markit Ltd and/or its affiliates.
Certain information contained in this news release may constitute forward-looking statements. We aution readers not to place undue reliance on any forward-looking statements, which speak only as of the date made and are subject to a number of risks and uncertainties.
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SOURCE Cboe Global Markets, Inc.
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