Benefits of Trading SPX Weeklys
- Certainty of Settlement, No Contra-Exercise Risk
- Cash settled European style options exercise at expiration, unlike American style, which may be exercised OTM after market close — eliminating potential economic and tax risk for writers
- Leading Liquidity Traded Around-the-Clock
- Tap into one of the most actively traded and liquid markets in the world, S&P 500, during Global Trading Hours. SPX Weeklys trade nearly 24 hours a day, five days a week**
- Cash Settlement & European Exercise
- Trading account credited/debited in cash, no delivery of unwanted shares or market exposure. European style is only exercised at expiration, eliminating risk of early assignment
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- Targeted Exposure
- Add greater precision to target specific market events like elections and corporate earnings reports
- Pay Less Time Premium
- The shorter the time to expiration, the smaller the time premium
- 60/40 Tax Treatment
- Capital gains may benefit from 60/40 tax treatment*
High-Probability Trades: Strategies for Trading SPX Weeklys OptionsRead Blog
Trading SPX Options
Comparison of S&P 500® Option Products
Cboe offers a comprehensive suite of listed options on the S&P 500 Index, including both standard and mini contract size, A.M. and P.M.-settlement, and standard, weekly or month-end expirations. Investors can even customize the key contract specifications with FLEX® options.
|SPX® Index Options||SPX Weekly and End of Month||Mini-SPX® Index Options||Nanos S&P 500 Index Options||SPDR® S&P 500® ETF Options|
|Root Ticker Symbol||SPX||SPXW||XSP||NANOS||SPY|
|AM or PM Settlement||AM||PM||PM||PM||PM|
|Settlement Date*||3rd Friday||Mon., Tue., Wed., Th., Fri., 3rd Fri. and Last Trading Day of Month||Mon., Tue., Wed., Th., Fri., 3rd Fri. and Last Trading Day of Month||Mon., Wed., Fri.||Mon., Wed., Fri., 3rd Fri. and Last Trading Day of Month|
|Approximate Notional Size (If S&P 500 Index is 3,900)||$390,000||$390,000||$39,000||$39||$39,000|
|Settlement Type||Cash||Cash||Cash||Cash||Physical Shares of ETF|
|Global Trading Hours Available**||Yes||Yes||Yes||No||No|
|Tax Treatment***||May benefit from 60% long term, 40% short-term capital gains||May benefit from 60% long term, 40% short-term capital gains||May benefit from 60% long term, 40% short-term capital gains||May benefit from 60% long term, 40% short-term capital gains||Standard|
* In the case of a holiday on the settlement date, the settlement date is moved back one business day (e.g. from Friday to Thursday), with the exception of Monday Weeklys, where the settlement date will move forward one business day (i.e. Monday to Tuesday). In addition, no SPX EOW, Monday Weeklys, Tuesday Weeklys, Wednesday Weeklys or Thursday Weeklys will be listed that would have an expiration date that coincides with the expiration date of a traditional SPX option or SPX EOM option.
** Global Trading Hours (GTH) The trading hours for options on the SPX, SPXW (SPX Weeklys and SPX End-of-Month), and XSP (Mini-SPX) begin at 8:15 p.m. Eastern time and end at 9:15 a.m. Eastern time. Please visit the Global Trading Hours page for more details.
*** Under section 1256 of the Tax Code, profit and loss on transactions in certain exchange-traded options, including SPX Options, are entitled to be taxed at a rate equal to 60% long-term and 40% short-term capital gain or loss, provided that the investor involved and the strategy employed satisfy the criteria of the Tax Code. Investors should consult with their tax advisors to determine how the profit and loss on any particular option strategy will be taxed. Tax laws and regulations change from time to time and may be subject to varying interpretations.