S&P 100 options

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In 1983 the Chicago Board Options Exchange introduced options on a basket of 100 stocks - a popular product that came to be known as S&P 100 (OEX) options. Instead of requiring investors to focus on specific stocks, cash-settled S&P 100 options with American-style exercise allows trading on a large segment of the domestic stock market with a single transaction to adjust their equity portfolio exposure.

The "OEX" is as a proprietary index of CBOE, licensed by Standard & Poor's to CBOE, which now manages the S&P 100 and is responsible for the addition and deletion of securities.

The S&P 100 Index (ticker symbol OEX) is a capitalization-weighted index, covering a broad range of industries. The capitalization-weighted feature means that the index gives greater weight to those stocks with greater market value. The market value is determined by multiplying the number of shares outstanding by the price per share. The market value of all of the stocks in the index are added together and divided by a "divisor", the result is the current value of the S&P 100 Index. Capitalization weighting allows for the index to accurately reflect the performance of the market's largest and most popular stocks.

Each OEX index option contract represents 100 times the current value of the Index. For example, when the Index is at 1400, the dollar value the index options will cover will equal $140,000 (or 100--the multiplier--times 1400).

Other indexes licensed by Standard & Poor's to CBOE include (some are proprietary to CBOE, while others are more widely licensed):

  • S&P 500® - SPX
  • Mini-SPX Index Options, 1/10th value SPX - XSP
  • SPDR® Options, Standard & Poor's Depositary Receipts based on S&P 500 - SPY
  • S&P 100 Index,® with European Style Exercise - XEO
  • S&P 100 ishares,® Exchange Traded Fund, with American Style exercise - OEF
  • CBOE Volatility Index® - VIX®
  • CBOE S&P 100 Volatility Index® - VXO®
  • CBOE S&P 500® VARB-X Strategy Benchmark - VTY