July 2014

MINI-SPX INDEX OPTIONS (XSP )

SM

Trade Mini-SPX Index options (XSP) for all the advantages of SPXSM at 1/10th the contract size.

Whether your goal is exposure to the broad market or portfolio protection, CBOEs Mini-SPX options (ticker symbol XSP)
offer all the advantages of S&P 500 Index options at 1/10th the contract size. Now you can tailor your trading strategies
with XSPSM options, and trade with greater efficiency and manageability.
CBOEs XSP options offer the same features as CBOEs SPX Index options, such as cash settlement, European-style exercise
and potentially favorable 60-40 tax treatment*. And now XSP is PM-settled, trading through the day at expiration (usually a Friday).

FEATURES OF XSP OPTIONS:

Smaller contract size with a contract size 1/10th the
size of SPX options (the same size as SPY options) to
fit a variety of portfolios and strategies
Cash settlement XSP contracts settle with cash, so you
never have to make or take delivery of unwanted shares
and disrupt your portfolio
Potentially favorable tax treatment* with many
SPX options trades eligible for 60-40 tax treatment
(see below)
European-style exercise which protects option sellers
against assignment prior to expiration (so-called early
assignment)

Electronic access to S&P 500 Index options fast and

simple point-and-click access to markets with the potential
for immediate execution of orders with CBOEs electronic,
state-of-the-art system
Risk mitigation S&P 500 Index options offer a convenient
and easy way to help reduce the risk of a broad market
portfolio
Predetermined risk purchasers risk only the premium
they pay for the option
PM-Settlement XSP options are PM-settled at expiration, so you can trade through the day on settlement day
(usually Friday), the same as single-stock options and ETF
options

Simplicity and efficiency achieve broad-market exposure

in one trade, with a manageable contract size. S&P 500
SM
Index options give you exposure to the broad market with Weeklys Now trade XSP Weeklys, with expirations
every
week,
up to 5 weeks out.**
diversification at a fraction of the cost of buying individual
stocks

Visit www.cboe.com/XSP for more information

*Under section 1256 of the Tax Code, profit and loss on transactions in certain exchange-traded options, including SPX and XSP, are entitled
to be taxed at a rate equal to 60% long-term and 40% short-term capital gain or loss, provided that the investor involved and the strategy
employed satisfy the criteria of the Tax Code. Investors should consult with their tax advisors to determine how the profit and loss on any
particular option strategy will be taxed. Tax laws and regulations change from time to time and may be subject to varying interpretations.
**XSP Weeklys will be added one week at a time, beginning June 26, 2014.

www.cboe.com/XSP

MINI-SPX INDEX OPTIONS

|2

SUMMARY OF KEY FEATURES

1. MANAGEABLE CONTRACT SIZE

4. BROAD-MARKET EXPOSURE

 SP options are based on 1/10 the value of

X
the S&P 500 Index giving you more flexibility and
manageability for a variety of trading strategies
and portfolios
th

 SP options give you access to the broad-market,

X
Standard & Poors 500 Index, at a fraction of the cost
of buying stocks and with the added benefit of known,
limited risk for option buyers

2. EASE OF CASH SETTLEMENT

5. TAX TREATMENT

 SP options settle into cash, so you never have

X
to make or take delivery of unwanted shares, which
can disrupt a portfolio. (Note that SPY options are
physical settlement into shares)

 nder section 1256 of the Tax Code, profit and loss

U
on transactions in certain exchange-traded options,
including SPX and XSP, are entitled to be taxed at a
rate equal to 60% long-term and 40% short-term
capital gain or loss, provided that the investor involved
and the strategy employed satisfy the criteria of the
Tax Code*

3. BENEFIT OF EUROPEAN-STYLE EXERCISE

 ike SPX and other Index options, XSP options can
L
only be exercised at expiration, so there is no risk of
early assignment

Comparison of options based on the S&P 500 Index

Description

CBOE S&P 500

Index Options

Mini-SPX
Index Options

SPDR
ETF Options

Options Chain

SPX

XSP

SPY

Weeklys Ticker

SPXW

XSP

SPY

$190,000

$19,000

$19,000

Notional Size (approx.)

with SPX at 1900
Exercise-Style

European

American

Cash

Physical Shares of SPY

Settlement Type
AM- or PM-Settlement

Micro Website

SPX standard: AM-Settled

SPX Weeklys: PM-settled

www.cboe.com/SPX

PM-Settled

www.cboe.com/XSP

www.cboe.com/SPY

* Investors should consult with their tax advisors to determine how the profit and loss on any particular option strategy will be taxed.
Tax laws and regulations change from time to time and may be subject to varying interpretations.

Options involve risk and are not suitable for all investors. Prior to buying or selling an option, a person must receive a copy of Characteristics and Risks of
Standardized Options. Copies are available from your broker, by calling 1-888-OPTIONS or from The Options Clearing Corporation at www.theocc.com. CBOE,
Chicago Board Options Exchange and Execute Success are registered trademarks and SPXSM, WeeklysSM and XSPSM are service marks of Chicago Board
Options Exchange, Incorporated (CBOE). S&P and S&P 500 are registered trademarks of Standard & Poors Financial Services, LLC and have been licensed
for use by CBOE. CBOEs options based on S&P indices are not sponsored, endorsed, sold or promoted by Standard & Poors, and Standard & Poors makes no
representation regarding the advisability of investing in such products. Copyright 2014 CBOE. All rights reserved.

CBOE | 400 South LaSalle Street | Chicago, IL 60605

www.cboe.com/XSP