10 Key Options Exchanges
Options trading is a popular way for investors to gain exposure to the financial markets and manage risks. Options are contracts that give the holder the right, but not the obligation, to buy or sell an underlying asset at a specified price, on or before a specified date. Options are traded on options exchanges, which are markets that facilitate the trading of options contracts.
In this article, we will provide an overview of 10 key options exchanges in the world, including their location, history, trading platforms, and the types of underlying assets available for trading.
Chicago Board Options Exchange (CBOE)
The CBOE is the largest options exchange in the world and was founded in 1973. It is located in Chicago, Illinois, USA. The exchange is known for its S&P 500 index options, which are the most widely traded options contract in the world. The CBOE also offers options contracts on other indexes, such as the Dow Jones Industrial Average and the Nasdaq Composite, as well as individual stocks and ETFs. The CBOE uses an electronic trading platform and also offers open outcry trading in designated trading pits.
NASDAQ OMX PHLX
The NASDAQ OMX PHLX, also known as the Philadelphia Stock Exchange, is the oldest options exchange in the United States, founded in 1790. The exchange is located in Philadelphia, Pennsylvania, USA. The NASDAQ OMX PHLX offers options on a wide range of underlying assets, including stocks, indexes, and ETFs. The exchange also offers trading in currency options, which is unique among U.S. options exchanges.
International Securities Exchange (ISE)
The ISE is an all-electronic options exchange that was founded in 2000 and is based in New York City, USA. The exchange offers options on a wide range of underlying assets, including equities, indexes, and ETFs. The ISE is known for its proprietary options trading platform, which offers a unique market structure that allows for increased price competition among market makers.
Eurex Exchange
The Eurex Exchange is one of the largest derivatives exchanges in the world, offering trading in futures and options contracts on a wide range of underlying assets, including equities, indexes, and fixed income products. The exchange is based in Frankfurt, Germany, and was formed in 1998 as a merger between the Deutsche Terminbörse and the Swiss Options and Financial Futures Exchange. The Eurex Exchange offers both electronic and open outcry trading.
Boston Options Exchange (BOX)
The BOX is an all-electronic options exchange founded in 2002 and based in Boston, Massachusetts, USA. The exchange offers options on a wide range of underlying assets, including stocks, indexes, and ETFs. BOX was the first options exchange to offer price-time priority, which means that orders are executed based on the best price and the earliest time of arrival.
Miami International Securities Exchange (MIAX)
The MIAX is an all-electronic options exchange that was founded in 2012 and is based in Princeton, New Jersey, USA. The exchange offers options on a wide range of underlying assets, including stocks, indexes, and ETFs. The MIAX exchange uses a proprietary trading platform called MIAX Pearl, which is designed to provide high-speed, low-latency trading.
NYSE American Options
NYSE American Options is a subsidiary of the New York Stock Exchange that offers options on a wide range of underlying assets, including equities, indexes, and ETFs. The exchange was founded in 2008 and is based in New York City, USA. NYSE American Options offers both electronic and open outcry trading.
Borsa Istanbul Derivatives Market (VIOP)
The VIOP is an options exchange that was founded in 2013 and is based in Istanbul, Turkey. The exchange offers options on a wide range of underlying assets, including equities, indexes, and commodities. The VIOP is the only options exchange in Turkey and is regulated by the Capital Markets Board of Turkey.
Taiwan Futures Exchange (TAIFEX)
The TAIFEX is an exchange that offers trading in futures and options contracts on a wide range of underlying assets, including equities, indexes, and commodities. The exchange was founded in 1997 and is based in Taipei, Taiwan. TAIFEX is the only futures and options exchange in Taiwan and is regulated by the Financial Supervisory Commission of Taiwan.
Tokyo Stock Exchange (TSE)
The TSE is the largest stock exchange in Japan and also offers trading in options contracts on a wide range of underlying assets, including equities, indexes, and ETFs. The exchange was founded in 1878 and is based in Tokyo, Japan. TSE is regulated by the Financial Services Agency of Japan and offers both electronic and open outcry trading.
The Bottom Line
Each of these options exchanges has its own unique characteristics, such as the types of underlying assets available for trading, the trading platform used, and the regulatory environment. Traders can choose the exchange that best suits their trading strategies and preferences. The options markets are an important part of the global financial system, providing traders with a way to hedge risks, speculate on price movements, and manage their portfolios.
