On the Internet: Options Web Sites
by CI Staff
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An option is a contractual agreement that gives the holder the right, but not the obligation, to buy or sell a fixed quantity of a security or commodity at a fixed price within a specified period of time. It is a type of derivative that investors use to hedge their risks against market volatilities or to exchange a floating rate of return for a fixed rate of return.
Developments in financial instruments have led to a variety of hybrids, including index options. An option can either be standardized, exchange-traded and government regulated, or over-the-counter customized and non-regulated. To satisfy the need for timely options data, information, and education, a number of sites have appeared on the Internet for options traders.
Chicago Board Options Exchange (CBOE)
The Chicago Board Options Exchange (CBOE) Web site offers a wide range of information, tools, and educational materials for beginner and experienced options traders.
For those who are not familiar with options, the CBOE Web site has a Learning Center powered by the The Options Institute that provides option tutorials, on-line courses, and Webcasts. Self-guided tutorials teach users the basics of options, the intricacies of the marketplace, and the strategies used by everyday investors. On-line courses are designed to help investors gain a better understanding of the uses of listed options. The Webcast center features live interactive presentations covering various options-related topics that allow participants to interact directly with instructors.
For experienced options traders, there are a variety of resources on the Web site including trading tools, specialized index sites, different options products, and market data. Users can also get real-time quotes for $19.95 per month, plus exchange fees; there is a 14-day free trial.
Options Industry Council (OIC)
The Options Industry Council (OIC) Web site is devoted to educating users about options and has a variety of options information and data. The Learning Center and the Options University offer educational resources such as options basics, a glossary of options-related terms, options strategies, and free on-line courses for registered users. The OIC also offers free seminars and conferences for options traders as well as brokers.
The Web sites Trading Desk offers useful options statistics and tools such as volume data, options quotes, symbol lookup, expiration calendar, options pricing calculator, and E-mail alerts. The Web site also has an Options Store that provides free videos, software, and literature about options.
The Options Clearing Corporation (OCC)
The Options Clearing Corporation (OCC) is the worlds largest equity derivative clearing organization. Its Web site provides a Learning Center, publications, and market data.
The Learning Center has basic and advanced sections on options. The basics half includes an explanation of options and options pricing, an options glossary, and free options literature. The advanced section covers topics such as volatility and the greeks and options strategies, plus offers interactive classes and free software downloads.
Publications available on the Web site include The Characteristics and Risks of Standardized Options, a disclosure document that all investors must read before buying or selling options. Other publications cover understanding options, options strategies, and taxes and investing. Avaiable market data includes volume data, series data, and position limit data.
The Web site also helps users search for brokers and provides useful tools such as an expiration calendar, options pricing calculator, delayed quotes, and E-mail alerts.
Chicago Mercantile Exchange (CME)
The Chicago Mercantile Exchange (CME) is the largest futures exchange in the United States and the second-largest exchange in the world for the trading of futures and options on futures.
The education and market data sections of the CMEs Web site are especially helpful to users who are beginner options traders. The CME education section provides classroom and on-line courses that blend leading theories with practical applications. The education section also provides resources such as publications and literature regarding options.
The market data section features delayed quotes and charts and historical data. Real-time quotes and charts can be accessed with monthly fees starting at $10.
Power Options is a subscription-based service that offers several programs for tracking and evaluating options investments. PowerOptionsPlus offers full access to the site and provides equity options data along with a suite of educational materials and toll-free customer support. The SmartSearchXL technology allows users to compare and analyze options investments. After a 14-day free trial, users pay $59.95 per month for the service.
PowerOptionsEssentials offers limited access to the Web site with 20-minute-delayed option position reports, all of the sites help section, and research pages. This service is available for $9.95 a month.
InvestorPerks is free with registration and offers options strategy articles, options market updates, and other investment article E-mails.
Optionfind.com is a subscription-based options screening tool. It offers an option hedging tutorial covering topics such as the foundation of an option hedge portfolio, derivative position creation, option volatility theory, the Black Scholes model, stock price movement, hedge creation, and hedge management.
The screening tools search engine allows users to screen for stock options or covered call options based upon the users parameterssuch as volume, open interest, stock price, option price, return, months until expiration, and Black-Scholes implied option premium. Once users obtain desired results, they can click a link and a Microsoft Excel spreadsheet file is automatically created containing the resulting options. This program has a two-week free trial. Subscription price is $15.00 per month.
The Schaeffers Research site offers a wide range of educational and analytical tools for options traders. Visitors will find a collection of sentiment indicators, an option pricing calculator, options expiration calendar, stock and options quotes, and intraday market commentary. There is also an extensive educational section covering both basic options concepts and strategies as well as advanced options trading topics and discussions. Visitors can purchase various research services, newsletters, educational products, and recommendation services with monthly fees. Specific information regarding the costs of products and services can be obtained on the Web site.
The Option Strategist
The Option Strategist Web site offers options trading resources, advice, and commentary from Lawrence G. McMillan, author and industry expert. The site provides free analysis and learning tools.
The free analysis tools section provides calculators for covered-call writing, expiration break-even point, and probability. This section also provides volatility data, Xtreme reports, wrap symbols, earnings estimates, and company fundamentals and news. Xtreme reports recap the highest and the lowest implied volatilities from yesterdays trading while wrap symbols show strike price values. In addition, the free analysis tools section offers option and stock quotes, and tutorials on how to read put-call ratios.
The free trading resources section offers six audio topics by McMillan, a searchable Q&As database, free E-mail newsletters, an events calendar, and helpful links for traders. There are also other analysis and learning tools as well as advisories that can be accessed for a monthly fee.
International Securities Exchange
The education area provides a symbol directory for those options listed on the exchange, options pricing and strategies, delayed stock and option quotes, market statistics, and an options calculator. The site also offers a free copy of the booklet Characteristics and Risks of Standardized Options.