Launched on March 18, 2013 mini options are contracts designed for investors wanting exposure to options on higher priced equity and ETF products, but with a reduced capital risk on those securities.
The mini options contracts are also designed for investors in these high priced securities who hold less than a round lot (100 shares) of these securities and would like to generate income by employing the covered call strategy.
The difference between a mini option contract and a standard option contract is the number of shares that underlie the contract. A mini option is a contract for 10 shares of the underlying security whereas a standard contract has an underlying of 100 shares. The rights and obligations on the two different contracts are the same in every other way.
The 10 share underlying means that the contract will require delivery or receipt of 10 shares per contract when either exercised or assigned. This also means that the premium multiplier is 10 instead of 100 for the standard contract. This 10 multiplier means that a mini contract purchased will cost 1/10 of the value of a standard contract.
These mini options contracts are initially available in:
- Amazon Inc. (AMZN trading under AMZN7)
- Apple Inc. (AAPL trading under AAPL7)
- Google Inc (GOOG trading under GOOG7)
- SPDR Gold Trust (GLD trading under GLD7)
- S&P 500 Index ETF (SPY trading under SPY7)
More Useful Information
Fees for mini Options: NYSE Amex / NYSE Arca
mini Options - Operational Outline: NYSE Amex / NYSE Arca
‘Understanding mini Options’ Guide (PDF)
mini Options FAQs (PDF)
Official Launch Press Release
Head of U.S. Options Steve Crutchfield Talks to The Street (Video)
Bill Ryan of NYSE U.S. Options – Educational Blog Posts