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DOW options and index options in general are similar to the equity options you
are familiar with with a few exceptions. First DOW options are european,
which means they cannot be early exercised.... they can be bought and sold all
day long, but only exercised on the Friday of their expiration month.
They settle AM instead of PM like equities. So for example the November series
halt trading at the COB this Thursday... settle at the opening on Friday
AM...the November options do NOT trade on Friday, but exercise back to the
Friday AM opening settlement.
They cash settle as opposed to physical settlement for equities.. so only cash
moves between accounts.
You might want to visit the CBOE website for more info and the DOW options. My
description applies to the DOW equity options, the CBOT also trades options on
the DOW future and you might want to visit their website for specifics.
Frank Thompson wrote:
> I am looking at "Options On The DOW" and was wondering if anyone has any
> experience with them. I am familiar with standard equity calls and puts and
> wonder what the differences are. I would appreciate any of your comments?
>
> Thanks for your input.
> Frank
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