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Natural Gas Short-Term Options Contract Specs

Options
Contract Unit A Short-Term Natural Gas Put Option contract traded on the Exchange represents the cash difference between the exercise price and the settlement price of the first nearby underlying Henry Hub Natural Gas Futures contract multiplied by 10,000, or zero, whichever is greater. In the event that the option is expiring on the last trading day of the first nearby Henry Hub Natural Gas Futures contract, the second nearby underlying futures will be used for settlement. A Short-Term Natural Gas Call Option contract traded on the Exchange represents the cash difference between the settlement price of the first nearby Henry Hub Natural Gas Futures contract and the exercise price multiplied by 10,000, or zero, whichever is greater. In the event that the option is expiring on the last trading day of the first nearby Henry Hub Natural Gas Futures contract, the second nearby underlying futures will be used for settlement.

Trading in a given Short-Term Natural Gas option contract is permitted on all listed days, including the expiration day. Note that a position established in a given Short-Term Natural Gas option contract on its expiration day is equivalent to establishing the same position in the NYMEX Daily Natural Gas option (symbol KD) contract with the same expiration day. The terms and conditions of the Daily Natural Gas Option are described in Chapter 832 of the rulebook.
Minimum Price Fluctuation $0.0001 per MMBtu
Price Quotation U.S. dollars and cents per MMBtu.
Trading Hours Sunday - Friday 6:00 p.m. - 5:00 p.m. (5:00 p.m. - 4:00 p.m. Chicago Time/CT) with a 60-minute break each day beginning at 5:00 p.m. (4:00 p.m. CT)
Product Code CME Globex: U01
CME ClearPort: U01
Clearing: U01
Listed Contracts Current day and the following four business days within a seven-calendar day period, unless that business day coincides with the expiration of a monthly Natural Gas Option in which case it will not be listed. No short-term option shall be listed if its expiration coincides with an Exchange holiday.
Termination Of Trading Expiration day will coincide with the contract ticker symbol. For example, C25 N11 would coincide with a expiration of July 25, 2011.
Position Limits NYMEX Position Limits
Exchange Rulebook NYMEX 1066
Block Minimum Block Minimum Thresholds
Vendor Codes Quote Vendor Symbols Listing
Strike Price Listing Procedures Strike Price Listing Procedures Table
Exercise Style European
Settlement Method Financially Settled
Underlying Henry Hub Natural Gas Futures

About Natural Gas

Henry Hub Natural Gas (NG) Futures allow market participants significant hedging activity to manage risk in the highly volatile natural gas price, which is driven by weather-related demand. They also provide efficient transactions in and out of positions. Natural gas futures are:

  • The third-largest physical commodity futures contract in the world by volume
  • Widely used as a national benchmark price for natural gas, which continues to grow as a global and U.S. energy source
  • An independent, stand-alone commodity

Things to know about the contracts:

  • Natural gas futures prices are based on delivery at the Henry Hub in Louisiana.
  • Traded via open outcry, electronically on CME Globex and off-exchange for clearing only as an EFS, EFP or block trade through CME ClearPort.
  • Options types include American, calendar spread, European and daily.

Read more about Henry Hub Natural Gas (NG) Futures