The Chicago Board Options Exchange (CBOE) is to launch Quarterly Standard & Poor’s 500 Index (SPX) options, Quarterly Mini-SPX Index (XSP) options and Quarterly Standard & Poor’s 100 Index with European-style exercise (XEO) options beginning 21 February 2007.
Quarterly options, first launched by CBOE in July 2006, provide investors with options that expire on the last trading day of each quarter to coincide with end-of-quarter accounting practices. By comparison, traditional options generally expire on the Saturday following the third Friday of the month. Quarterly options have become especially popular with money managers who rebalance or settle portfolios on the last day of each quarter, and who use options as part of their portfolio management strategy.
CBOE currently lists Quarterly options on five ETFs: iShares Russell 2000 Index Fund, Nasdaq-100 Index Tracking Stock, Standard & Poor’s Depositary Receipts/SPDRs, DIAMONDS Trust, Series 1, and Energy Select SPDR.
Volume and customer interest in Quarterly options has increased steadily, with total Quarterly volume traded at CBOE in January reaching 552,707 contracts.