Index options trading – what is it?
It’s the trading of the options that get their value from the underlying cash index. The CBOE has many index options products. For a full list go to their site for more information on cash settled index options http://www.cboe.com/products/Cash-SettledIndexOptions.aspx
Indices, index options have unique price behavior of which we can exploit for a trading edge. That said index options have their own set of risks primarily in large premiums and large potential negative time decay if long. But also, indices also can have very large price swings, and when played right these index options can product large profits, quickly.
Index options trading can be traded for trends, swings and even for intraday day trading!
Check out our Index Options Trading Systems for more information on that.
Here are some of the more popularly traded indices with options:
To get options quotes go here: Index Options Quotes
Binary Index Options – you have 2 types primarily: The popular daytrading style and the CBOE longer term binaries: