DERIVATIVES

CBOE to launch 10 S&P sector options

Extension of S&P benchmark offering will give investors access to sector strategies through options.

By John Bakie john.bakie@strategic-i.com September 12, 2017 12:27 PM GMT

CBOE plans to launch options for S&P Select Sector Indicies, expanding its existing offerings tied to S&P Dow Jones benchmarks.

It will launch options for all 10 sector indices, which all comprise the S&P 500 benchmark of US equities markets.

CBOE said the options will provide simple market exposure to widely followed US equity sectors. The options will be particularly attractive to European investors who cannot currently hold options of ETFs due to regulatory issues, who will now be able to implement sector-investment strategies.

The options will offer investors the benefits of cash settlement, with third-Friday of the month expirations and European-style exercise.

The options launch is pending regulator approval but is expected to take place late in Q4 2017 or early in 2018 and will be available on the Chicago Board Options Exchange.

CBOE Holdings president and chief operating officer, Chris Concannon, said: “CBOE Select

Sector Index options will offer European asset managers and investors the targeted exposure to U.S. equity sectors they have been missing, and also give U.S. asset managers a new avenue for options investment.”