New index data
We are expanding our platform to include data from some major stock market indices and their options:
- SPX: S&P 500 Index
- VIX: Cboe Volatility Index
- XSP: Mini S&P 500 Index (Similar to SPY at 1/10th of SPX)
- DJX: 1/100th Dow Jones Industrial Average Index
- OEX: S&P 100 Index (and XEO, the European settled version of this index)
These indices will be available across all our product features, including the strategy builder and options flow.
Global trading hours
SPX and VIX have options which trade nearly 24 hours a day, allowing traders to adjust and manage their positions in response to events around the world as they happen. These hours also overlap with related futures trading hours.
- Core session: 9:30am to 4:15pm (Eastern time)
- Curb session: 4:30pm to 5pm
- Global trading session: 8:15pm to 9:15am (the next day)
OptionStrat prices will update during any extended trading sessions, and our calculations consider these non-standard operating hours. For example, the strategy table will show theoretical prices for the overnight sessions, and even show you the opening price when SPX and VIX begin trading on Sunday evenings.
Advantages of index options
You might be wondering why you should trade these options over the existing ETF alternatives such as SPY or VIXY. These index options have a few unique features that you should be aware of.
(Potentially) favorable tax treatment: Index options qualify as section 1256 contracts under IRS rules, meaning that any gains or losses from trading them are treated as 60% long term and 40% short term, regardless of how long you held them.
European style: Nearly every index option is European style, as opposed to American style options on stocks and ETFs. European options can only be assigned or exercised at expiration, instead of at any time. Normally it doesn't make sense to exercise an American option before expiration, however if a dividend is coming up on an ETF like SPY, that dividend may be greater than the time value on the option, making it worth it for the option owner to exercise an option and collect the dividend. If you are on the other side of this trade, you could find yourself in for a surprise! With European options you can rest easy knowing this can't happen.
Cash-settled: With standard options like SPY, shares are physically delivered upon exercise/assignment. If a call is exercised, the trader will purchase 100 shares from someone who has shorted the same call. With cash-settled index options, there are no shares involved (because an index is just a number, not a tradeable product), and the trader is simply credited or debited the appropriate amount of cash. This eliminates overnight pin risk, where it appears that you are in-the-money or out-of-the-money at market close, but the market moves after hours and you end up getting assigned. You also don't have to worry about trying to close your option before expiration (if you don't intend to be assigned or exercise).
To summarize the differences, use this chart below:
|SPY (an ETF)||XSP (an Index)|
|Settled with shares||Settled in cash|
|American style||European style|
|Short term gain if held less than a year||Always 40% short term, 60% long term|
|Standard trading hours||Global trading hours|
Future market data expansions
We understand that some traders are looking for additional data including options on futures (for example, /ES options) or options on indices from other providers like Nasdaq and FTSE (for example, NDX or RUT). Each market has its own market data costs and licensing agreements, so we must prioritize what markets are most important to our users first. Please reach out to us to register your interest in other markets. We will use this data to choose where to expand next.