US Options Market

[NAsX]

Hi guys,

I'm looking into options as an alternative trading/investing product from futures, and was wondering if someone can give a general idea on the index options market, eg. most liquid market, your personal favorite markets...etc.

So far from my research, I see that the SPY is perhaps the most traded product, based on the S&P500 ETF, and is physically settled. The SPX and XSP are cash settled much like the XJO options we've got, and on the Dow there is the DJX. Have I missed any, and which ones do you guys trade?

I've also looked at forex options, and the only thing available seems to be CME future options, however they don't seem to have much liquidity?

Anyways, I've only just started to look at options (long due) and would appreciate any comments.

Cheers

 

[NAsX]

Thought I'd add that I've also looked at European index options, and the DAX also seems to be quite liquid? and it would suit our timeframe. Anyone trading them?

 

[matty2.0]

There are options on almost everything in the US.
Just get an international broker and all the information should be there.

Not particularly options, but I think the S&P futures are quite popular among traders: e.g. ESM9 (Mini-S&P500s).

 

[cutz]

Hi guys,

I'm looking into options as an alternative trading/investing product from futures, and was wondering if someone can give a general idea on the index options market, eg. most liquid market, your personal favorite markets...etc.

So far from my research, I see that the SPY is perhaps the most traded product, based on the S&P500 ETF, and is physically settled. The SPX and XSP are cash settled much like the XJO options we've got, and on the Dow there is the DJX. Have I missed any, and which ones do you guys trade?

I've also looked at forex options, and the only thing available seems to be CME future options, however they don't seem to have much liquidity?

Anyways, I've only just started to look at options (long due) and would appreciate any comments.

Cheers

Hi NasX,

By far my favorite options market is the Australian market, only because i need my beauty sleep but saying that i do play around with SPY series, small positions only, spreads are tight and there's heaps of OI.

For your info there’s also OEX S&P100 American exercise and XEO S&P100 European exercise,(both cash settled) contracts are smaller than SPX options but spreads seemed pretty wide last time I checked, I never traded those so that’s all I can say.

Hope it helps.

 

[jackson8]

hi

have also heard mention of the
rut 2000 index which seems fairly liquid

adding to this yahoo finance is a good place to find information

 

[Grinder]

I like RUT, good fills & tight spreads. SPX, XEO a NDX(alittle volatile & wider strikes) are all euro settled so I trade em also. Have'nt traded any ETFs as yet, SPY, DIA & IWM come to mind though.

 

[NAsX]

Hi all, thanks for the replies

Yeah I like the fact that index options are euros, from a beginner's point of view, I won't have to worry about being exercised anytime. The thing with US market is the time like I mentioned, so will probably explore more the Asian and Euro markets. Of course, there's also the XJO options which I also think would be a good place to start.

Anyways, appreciate your comments and keep them coming

 

[Grinder]

Nasx,

Yep. The time is the biggest (if not the only) obstacle when trading the US from Oz, but well worth the trade off imo. Most options are traded in the last couple of hours so that's when I'm up to trade them.

Hi all, thanks for the replies

Yeah I like the fact that index options are euros, from a beginner's point of view, I won't have to worry about being exercised anytime. The thing with US market is the time like I mentioned, so will probably explore more the Asian and Euro markets. Of course, there's also the XJO options which I also think would be a good place to start.

Traded the XJO due to convenience. If your trading in & out of positions racking up fees, it will eat into your profit very quickly & as others will tell you, the MMs can see you comming from down the road so allow for significant slippage.

Looked into the Kospi, is pretty volatile but with loads of volume. Have'nt looked at any of the Euro exchanges so let us know what you find out.

 

[NAsX]

Hi Grinder,

Thanks for the reply. Yeah I don't actually mind the waking up early, have been doing on occasions to catch some ES trading. Hehe I don't mind missing out on my beauty sleep if the trade off is big enough :

So far, I've narrowed down the XJO, HSI (high volume too), probably not the Kospi due to the currency. The Euro markets, I looked at the DAX, FTSE and CAC, and it would seem the DAX having the biggest volume and tight spreads, and the contract is 5 euro a point.

Again, I've only started to seriously looking into options like this week, so I'm not the best person to judge, just some general observations

 

[IseMalakas]

I trade US options using optionsXpress, and have done so for about 2 years. I started doing covered calls, collars, spreads, I do >30 days to expiry trades so once placed I only have to watch a few minutes, and maybe adjust. So I don't need to stay up at night at all, (sometimes when I can't sleep I do, but that's choice) Using optionsXpress is the best thing I've ever done! Excellent platform, professional and cheap!
I need to as I'm slowly recouping my massive losses from Camelot Derivatives