​Mid-Weekly: Putwrite Strategies Questioned, VSTOXX RP Opening

Market attention is shifting to Europe and the upcoming French election, with potential risk premia trades in the offing. Investors are seeing potential in the VSTOXX to extract risk premia around the event. Meanwhile in the U.S., putwrite strategies that have become popular over the last few years may not fare well during an extreme drawdown in equity markets, despite what some back testing data might suggest, according to one market participant. He cites a lack of liquidity in the options market, noting investors should not just rely on back test data alone. Also in the U.S., the annuity market is experiencing an active week, with Voya and Lincoln releasing FIAs, while Eurex sees potential in its newly launched div futures.