Product Information

CME Group Options Trading Notice

1. American Options:Most monthly options on the CME Group (CME, CBOT, COMEX, NYMEX) are American-style options, where the buyer can request to exercise the option on any day before expiration. Due to time value considerations, this typically occurs two or three days before expiration, though it is not common. Customers can contact their sales representative or trading desk personnel to request exercise.
2. European Options:Weekly options and forex options on the CME Group are European-style and do not accept early exercise requests. They are automatically exercised or abandoned after the close of trading on the expiration day.
3. Exercise Method:For stock index options and European-style eurodollar futures options in the quarterly months, automatic exercise takes place after the close of trading on the last trading day and is settled together with futures in cash settlement. For live cattle, lean hogs, and 30-day interest rate futures options, automatic exercise results in cash settlement after the close of trading on the last trading day.Early exercise or other months and products will result in futures positions for the underlying contract, and the exercise price will determine the position held. After the close of trading on the expiration day, in-the-money options are automatically exercised, while out-of-the-money options are abandoned. For forex and NYMEX options, at-the-money (where the market price equals the exercise price) calls are treated as in-the-money and exercised, while puts are treated as out-of-the-money and abandoned. For other products, both at-the-money calls and puts are considered out-of-the-money and abandoned.
   For example:Buy Call: Exercise results in a long futures position in the underlying.Sell Call: Exercise results in a short futures position in the underlying.
   Buy Put: Exercise results in a short futures position in the underlying.Sell Put: Exercise results in a long futures position in the underlying.
4. Buyer's Attention: Since futures options that are in-the-money at expiration are automatically exercised, buyers must ensure they have sufficient margin to cover the resulting futures position. If the buyer does not have enough margin for the underlying futures contract, they will face forced liquidation (cash settlement for expiration is an exception).
5. Seller's Attention: A few in-the-money option sellers may be assigned a futures position by the exchange if the buyer requests exercise. Out-of-the-money options do not permit the buyer to request exercise and will expire worthless.
   Exceptions:For American options, buyers may request early exercise during trading hours on the last trading day or exercise at the close for in-the-money positions. Since the exchange assigns the corresponding seller after the close of trading via a random process, it is possible that sellers of out-of-the-money options may be assigned exercise or sellers of in-the-money options may be assigned abandonment after the close on the last trading day. Sellers typically receive notification the next business day (around noon Taipei time). Sellers should note this risk and bear the resulting profits or losses.
6. Expiration Date: CME Group futures options, with the exception of quarterly stock index options, quarterly eurodollar futures options, live cattle, lean hogs, and 30-day interest rate futures options, expire one to five days before the underlying futures' last trading day (whichever comes first between the first notice day or the last trading day). For more details, please visit our website.
7. Underlying Futures Months: Most active futures options on the CME Group have monthly expirations, with the most recent month being the underlying.
   An exception is copper: currently, futures are available for all 12 months, but only the 1st, 3rd, 5th, 7th, 9th, and 12th months are active. Copper options correspond to these months, so both futures and options are only available for these specific months.
8. Trading Hours: Futures options have the same electronic trading hours as futures, except on the last trading day, when they may differ.
   Some futures products, such as foreign exchange (e.g., euro (EC)), settle earlier due to manual closing processes, and seasonal index options like the S&P (ES) settle early for cash settlement with futures. Some products, such as gold (GC), have fully synchronized trading hours with futures.
   For contract specifications, minimum tick size, etc., please refer to our website.
9. Exercise Fee:Both option exercise and assignment incur a handling fee.
10. Seller's margin: market value of premium + MAX (original margin for futures/2, original margin for futures - out-of-the-money value/2)
    Our company does not currently accept offsetting or combination margin calculations; each position is calculated individually.
11. Tradable Exercise Prices and Expiration Months: Our online trading system provides quotes and trading for the more active months and strike prices. For other months, strike prices, or products, customers can call their sales representative or trading desk personnel for quotes and trading.