I received quite a few emails over the weekend asking how to buy index options. Below is a brief introduction and how some option contracts traded on the Dow, Nasdaq, and S&P 500. Each index lost 3% Friday.
Dow Jones Industrial Average Index
DJX (122.10, down 3.94) is the symbol for options on the Dow and are based on 1/100th of what the index is currently trading at. The Dow was at 12,600 before Friday’s drubbing which is where the aforementioned quote comes from.
June 125 put (DJWRU, $3.65, up $2.50), opened at $1.60
June 120 put (DJWRP, $1.22, up $0.91), opened at $0.58
June 125 call (DJWFU, $0.75, down $1.54), opened at $1.39
June 127 call (DJWFW, $0.30, down $0.80), opened at $0.60
Nasdaq-100 Volatility Index
This index is cap-weighted and comprised of 100 of the largest non-financial stocks that trade on the Nasdaq. It’s not based on 1/100th like the Dow is. The symbol is NDX (1990.39, down 64.72).
June 1900 put (NDYRR, $10.70, up $7.25), opened at $4.20
June 1875 put (NDYRH, $7.50, up $4.90), opened at $3.10
June 2075 call (NDXFO, $6.30, down $18.30), opened at $16.30
June 2100 call (NDXFU, $3.60, down $9.80), opened at $9.80
S&P 500 Index
The SPX (1,360.68, down 43.37) contains 500 stocks from a bunch of different industries. The stocks are “weighted” by market value and how many shares are outstanding and pretty much trades in tandem with the S&P 500. It’s the favored index for many option traders.
June 1350 put (SXYRJ, $19.50, up $15.30), opened at $6.70
June 1325 put (SXYRE, $11.50, up $9.15), opened at $9.15
June 1425 call (SYXFE, $1.80, down $6.80), opened at $5.30
June 1450 call (SYXFJ, $0.55, down $1.65), opened at $1.15
Friday’s volatile day was fun to watch if you were “short” the market and you could feel the downward pressure taking place all day. Friday’s big move in oil pushed the average price of regular gas to $4 a gallon for the first time over the weekend. It’s funny how the unimaginable became a reality right in time for the peak summer travel season. The way things are going, it wouldn’t be a surprise to see people cut back on “vacationing” as many people simply cannot afford it. Just think if you live in California. A gallon of gas is averaging $4.44 a gallon!
It should be another interesting week as there are a number of events going on that will certainly move the market.
Rick Rouse
Rick@OptionsMentoring.com
