CBOE to list new ETF Weekly options on Friday

Posted June 3, 2010 at 3:47 p.m.

Reuters | The Chicago Board Options Exchange, the largest U.S. options market,
said it will begin trading new one-week options on four exchange-traded
funds that track major stock benchmarks starting on Friday.

The shorter-term options will be listed on the Standard & Poor’s
Depositary Receipts, the Nasdaq-100 Index Tracking Stock, DIAMONDS Trust, Series 1 and the iShares Russell 2000
Index Fund, CBOE said in a statement on Thursday.

The options generally have the same contract specifications as standard options, except for the time of expiration and offer the same continuous, two-sided quotes as standard options, CBOE said. One-week options differ from traditional options that have a life of months or years before expiration.

A new series for Weekly options are listed each Friday and expire the following Friday, except that no new Weeklys will be listed that would expire during the expiration week for standard options which occurs the third Friday of each month.

Trading volume in the shorter-term options has grown since CBOE introduced the products in October 2005, CBOE said.

Average daily volume for Weekly index options on the Standard & Poor’s 500 index .SPX in the first five months of 2010 was 16,031 contracts or 2 percent of standard options on the S&P 500 benchmark.

Average daily volume for one-week options for the Standard & Poor’s 100 index .OEX during the same period totaled 15,489 contracts or 31 percent of standard options on the OEX, the exchange said.

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