Cme wheat futures futures market chatter points to

Futures market chatter points to increased volatility in CME wheat contracts as speculative traders respond to geopolitical tensions in grain-exporting corridors. July wheat traded near $6.29, with call option premiums expanding 12% over the week. Convexity is defined as the ratio of CVOL divided by the market’s at-the-money (ATM) implied volatility metric, which is included in the CVOL suite. In essence, it measures if there is excess variance in the wings of the options strike prices versus ATM. A higher convexity suggests greater acceleration of market volatility, regardless of the underlying market’s rally or decline. Higher convexity translates to greater price volatility for options from the current market price (out-of-the-money options). This suggests increased market uncertainty about the future direction of prices, coupled with an expectation that the underlying futures price will move away from its current level. This suggests the options market sentiment for a growing uncertainty beyond what is indicated by the volatility curve itself. As a ratio, it can be easier to compare across asset classes. The CME Group has launched its hard red spring wheat futures contracts. Trading screens showed steady bids in CME wheat futures, with July contracts gaining 0.4% to $6.