CandleFocus Glossary Editor
The OEX (acronym for Standard & Poor’s 100 Index Options) is one of the oldest and most popular index options on the Chicago Board Options Exchange (CBOE). OEX options allow traders to hedge or speculate on the performance of the large-cap segment of the U.S. stock market, providing exposure to the 100 largest companies across all major industries.
The OEX Index consists of stocks from a wide variety of industries, including oil and gas, banking, technology, healthcare, and consumer goods. It is a capitalization-weighted index, meaning that the largest companies in the index have the greatest influence on index performance. As of January 2020, the index was dominated by Apple (12.6%), Microsoft (10.3%), and Amazon (7.9%).
OEX options are American-style options and offer a variety of strikes and expiration dates. Options expire on the third Friday of each month, and the underlying index settles on the morning of the third Saturday. OEX options allow traders to take advantage of both directional and non-directional trading strategies such as covered calls, protective puts, and straddles.
Options on the S&P 500 (SPX) have, over time, become more popular than OEX options. However, OEX options are still used by traders due to their relatively cheap cost as compared to SPX options. Moreover, OEX options give traders exposure to a narrower range of stocks than the S&P 500. This makes OEX options a good choice for speculative bets on individual companies.
In conclusion, the OEX is the ticker symbol used to identify the dollar-denominated Standard & Poor’s 100 index options traded on the Chicago Board Options Exchange (CBOE). OEX options allow traders to take advantage of both directional and non-directional trading strategies as they provide exposure to the 100 largest companies across all major industries. Although options on the S&P 500 (SPX) have become more popular than OEX options, OEX options are still used by traders due to their relatively cheap cost and narrower index range.
The OEX Index consists of stocks from a wide variety of industries, including oil and gas, banking, technology, healthcare, and consumer goods. It is a capitalization-weighted index, meaning that the largest companies in the index have the greatest influence on index performance. As of January 2020, the index was dominated by Apple (12.6%), Microsoft (10.3%), and Amazon (7.9%).
OEX options are American-style options and offer a variety of strikes and expiration dates. Options expire on the third Friday of each month, and the underlying index settles on the morning of the third Saturday. OEX options allow traders to take advantage of both directional and non-directional trading strategies such as covered calls, protective puts, and straddles.
Options on the S&P 500 (SPX) have, over time, become more popular than OEX options. However, OEX options are still used by traders due to their relatively cheap cost as compared to SPX options. Moreover, OEX options give traders exposure to a narrower range of stocks than the S&P 500. This makes OEX options a good choice for speculative bets on individual companies.
In conclusion, the OEX is the ticker symbol used to identify the dollar-denominated Standard & Poor’s 100 index options traded on the Chicago Board Options Exchange (CBOE). OEX options allow traders to take advantage of both directional and non-directional trading strategies as they provide exposure to the 100 largest companies across all major industries. Although options on the S&P 500 (SPX) have become more popular than OEX options, OEX options are still used by traders due to their relatively cheap cost and narrower index range.