By Jeff Kearns

March 24 (Bloomberg) — Jeremy Wien, the head of VIX options trading at Societe Generale SA, left France’s second- largest bank to trade derivatives at New York-based hedge fund Alphabet Management LLC.

Wien, 25, was hired from Goldman Sachs Group Inc. in 2007 to start the business of trading options on the VIX, as the Chicago Board Options Exchange Volatility Index is known. Societe Generale traded more of the contracts than anyone else last year, according to a report prepared by CBOE for the bank.

“I have a new and exciting opportunity,” Wien wrote in an e-mail to clients today. “I am looking forward to a new set of challenges.”

VIX options trading expanded 28 percent last year to 33.3 million contracts, according to CBOE data. U.S. options volume for contracts on stocks, indexes and exchange-traded funds rose to a seventh straight annual record last year, increasing 0.8 percent to 3.61 billion, according to Chicago-based Options Clearing Corp.

Jason Adler, a managing member at Alphabet, confirmed that Wien was hired and said the firm has about 20 traders who specialize in equity options and volatility arbitrage. Jim Galvin, a spokesman for Societe Generale in New York, declined to comment. Alphabet has $140 million in assets.

Options are derivatives that give the right to buy or sell assets at a set price by a specific date. Implied volatility is the key gauge of options prices and expected price swings. The VIX measures the cost of using options as insurance against declines in the Standard & Poor’s 500 Index, the benchmark measure of U.S. stocks.

To contact the reporter on this story: Jeff Kearns in New York at jkearns3@bloomberg.net.

Last Updated: March 24, 2010 18:31 EDT

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