SPX Options (S&P 500
Index)
S&P 500 (SPX) options are among the most highly
liquid options on the market. The S&P 500 Index is comprised of 500 leading
companies (most of them listed on the NYSE) from a diverse array of
industries. Even though many individual traders follow the Dow Jones Index
as reliable trading indicator of overall market performance, institutional
traders rely more heavily on the S&P 500, considering it the better
indicator.
SPX options are available for the three months
closest to the current date, plus March, June, September, and December.
LEAPS options are available for the S&P 500 Index as well. SPX options
strike prices are usually set in intervals of 25 points.
Several factors attract investors to SPX options,
including:
- SPX options are tied to the S&P 500 Index - the
world's leading benchmark for institutional investors.
- SPX options allow investors to trade a cumulative
basket of a 500-stock portfolio;
- Trading SPX options requires less capital than
trading the options of individual stocks;
- S&P 500 index options are a highly liquid trading
vehicle.
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