Penny Priced Options

 
TOP CONTRIBUTORS

Penny priced options (PPOs) are equities derivative options that trade in penny increments, unlike the majority of options that have a spread (difference between bid and ask) of five or ten cents. They are the product of the Penny Pilot Program that was initiated in November, 2006. The primary benefit is that the round trip cost of the trade can be pared down significantly (instead of rounded up, as with other spreads on the bid and ask). These options are associated with the most heavily traded equity issues. The high trading volume on the stocks positively correlates with the high Open Interest of the related option chain. In fact, the 63 option issues represent approximately 60% of total option volume (excluding SPX).

Here is a list (from March 2008) of equities (stocks and ETFs) that offer penny priced options: A AA AAPL AIG AMD AMGN AMZN BAC BMY BSC C CAT CFC COP CSCO DELL DIA DNDN EBAY EEM EMC F FCX FLEX GE GM GS HAL HD INTC IWM JAVA JPM LEH MER MNX MO MOT MSFT NEM NYX OIH PFE QCOM QQQQ RIMM RIO SBUX SMH SNDK SPY T TGT TXN VLO VZ WFMI WM WMT XLE XLF XOM YHOO

More information:

http://www.amex.com/amextrader/sysInfo/ANTE/PennyPilotReport_11022007FINAL.pdf

http://www.cboe.org/hybrid/pennypilot.aspx

Wikinvest © 2006, 2007, 2008, 2009. Use of this site is subject to express Terms of Service, Privacy Policy, and Disclaimer. By continuing past this page, you agree to abide by these terms. Any information provided by Wikinvest, including but not limited to company data, competitors, business analysis, market share, sales revenues and other operating metrics, earnings call analysis, conference call transcripts, industry information, or price targets should not be construed as research, trading tips or recommendations, or investment advice and is provided with no warrants as to its accuracy. Stock market data, including US and International equity symbols, stock quotes, share prices, earnings ratios, and other fundamental data is provided by data partners. Stock market quotes delayed at least 15 minutes for NASDAQ, 20 mins for NYSE and AMEX. Market data by Xignite. See data providers for more details. Company names, products, services and branding cited herein may be trademarks or registered trademarks of their respective owners. The use of trademarks or service marks of another is not a representation that the other is affiliated with, sponsors, is sponsored by, endorses, or is endorsed by Wikinvest.
Powered by MediaWiki