Options on Equity Index Sector Futures
We have introduced options on Equity Index Sector futures, providing traders with greater flexibility and choice to capture equity sector exposure. These options offer cost savings through initial margin and margin offsets, making them highly capital efficient.
Underlying indices
The underlying indices for these options include E-mini S&P Select Sector Index futures and Dow Jones U.S. Real Estate Index futures. These indices are administered by S&P Global and Dow Jones, offering a wide range of sector exposure.
We offer options on six E-mini S&P Select Sector Index futures and options on Dow Jones U.S. Real Estate Index futures:
- E-mini Standard and Poor's Select Sector Energy Index futures
- E-mini Standard and Poor's Select Sector Financial Index futures
- E-mini Standard and Poor's Select Sector Health Care Index futures
- E-mini Standard and Poor's Select Sector Industrial Index futures
- E-mini Standard and Poor's Select Sector Technology Index futures
- E-mini Standard and Poor's Select Sector Utilities Index futures
- Dow Jones U.S. Real Estate Index futures
These options allow traders to capture spreading opportunities versus the constituent stocks of a sector index or the S&P 500 Index. Additionally, they can be used to create a portfolio overlay to hedge unintended sector risk.
Listing cycle
Options on Equity Index Sector futures are listed with quarterly contracts, initially available for December 2024 and March 2025. These options are American style, allowing for exercise and assignment at any time up to expiration.
Strike prices and position limits
Strike prices are available in intervals that provide necessary strikes and hedging tools for clients. The position limits for these options contracts are determined in conjunction with the positions in the underlying futures. For more information on position limits, visit Market Regulation.
Margin and fees
The clearing house will margin these options in the SPAN 2 model. Options on E-mini S&P Select Sector Index futures are listed on the CME DCM and follow the CME Fee Schedule under the Equity tab. Options on Dow Jones US Real Estate Index Futures are listed on CBOT DCM and follow the CBOT Fee Schedule under the Equity Index Products tab.
Block trades
For block trades, a list of firms willing to provide liquidity is available on our website.
Summary
Options on Equity Index Sector futures provide a valuable tool for traders seeking greater flexibility and capital efficiency in capturing equity sector exposure. With a wide range of underlying indices and flexible contract terms, these options offer numerous opportunities for spreading and hedging strategies.
For more detailed information, explore the FAQ to learn how options on Equity Index Sector futures can enhance your trading strategies.