Below, you will find a few examples of index options that have consistently displayed a very high liquidity.
Dow Jones Industrial Average Index options (DJX)
The Dow Jones Industrial Average Index (DJIA) is the oldest continuous market index in the United States. It was established in the late 1800s. Options based on the DJIA were first introduced in 1997.
DIJA is one of the worlds most famous and most frequently traded stock indices. Even people who aren’t stock traders usually know about “the Dow Jones”. DIJA is considered a key trading indicator and a good representation of the overall U.S. stock market performance.
The DJX Index options is calculated as 1/100 of the current value of the DJIA. So, if the DJIA is 10,000 USD the DJX Index options contract will be priced around 100 USD. The strike prices are set in intervals of 100 points.
DJIA is comprised of 30 very large, well-establish and consistently well-performing stock companies. DJX Index options can be used to benefit from their performance without actually having to purchase shares in each of the 30 companies.
NASDAQ-100 Index Options
There are several different options available if you want to trade in options based on the NASDAQ 100 index.
- NDX: NASDAQ-100 Index Options
Each option is for 100 shares.
- Mini-NDX: NASDAQ-100 Index Options
Each option is calculated as 1/10 of the value of the NASDAQ-100 Index.
OEX Options (S&P 100 index)
OEX is the ticker symbol for an option based on Standard and Poors 100 Stock Index. The S&P 100 Index is comprised of 100 blue-chip stocks from various industry groups. OEX issues are not equally weighted.
The S&P 100 is regarded as a good gouge of the market’s general performance. All of the stocks included in the S&P 100 Index are also included in the famous S&P 500 Index.
OEX options, with American-style exercise, first appeared in 1983.It wasn’t until 2001 that CBOE introduced S&P 100 options with European-style exercise. These options have the ticker symbol XEO.
SPX Options (S&P 500 Index)
SPX Options are based on the S&P 500 Index. A majority of the 500 companies included in the index are listed at NYSE. The companies are selected from several different industries. Historically, institutional traders have been more interested in the performance of the S&P 500 than of the DJIA.
At the time of writing, SPX Options are available for the three months closest to the current date, plus March, June, September and December. LEAPS options also available.
Strike prices are usually set in intervals of 25 points.