VIX future option trading significantly below index?

[rlangmead]

The 22/05/2025 (UK date) futures option on the VIX is trading significantly below the index itself. With only two days until the closing date, will these two close over the next two days? Can an option close at a different value to the underlying? 

[Spook1304]

I cant really answer this question but also had the same issue when trying to get clarity from IG with regards to futures contracts.
The prices for the spot and future/option SHOULD converge upon expiry as the intrinsic value of the spot/future (time) is no longer present.
However, when monitoring this, this was not the case. Multiple times, I had a future contract and a spot contract and the expired at different prices. I understand a small deviation can happen but the gaps I was seeing were substantial.

I got some replies from IG saying it should converge but what they said and what the markets actually done were two different things.

Check this post, I put on screenshots of what should happen vs what did happen:

 

[Spook1304]

From further research, the undated/spot/cash index is calculated based on the front two futures contracts JUN and JUL in this case.

The price will be somewhere between the first and second month futures depending on how far apart the prices of those instruments are and the time difference between their expiry dates.

See this link for more info:

https://www.ig.com/uk/help-and-support/spread-betting-and-cfds/products-markets-and-trading-hours/how-are-spot-commodities-priced--and-how-is-my-overnight-funding

So to answer your question, No, it won't converge on the index price as the index price on IG is somewhere between the 1st and 2nd month futures. Happy for anyone to correct me on this.