Options Talk - Episode 26 - US options (on ETF's) Options Talk - Episode 26 - US options (on ETF's) Options Talk - Episode 26 - US options (on ETF's)

Options Talk - Episode 26 - US options (on ETF's)

Options 10 minutes to read
Koen Hoorelbeke

Options Strategist

Summary:  In Episode 26 of 'Saxo Options Talk,' Koen Hoorelbeke and Peter Siks dive into the world of U.S. options on ETFs, exploring the key differences between U.S. and European markets. This episode is a must-listen for traders looking to take advantage of the high liquidity and diverse strategies available in U.S. sector ETFs.


Options are complex, high-risk products and require knowledge, investment experience and, in many applications, high risk acceptance. We recommend that before you invest in options, you inform yourself well about the operation and risks.

Introducing episode 26 - U.S. options on ETFs - comparing U.S. and European markets

"Episode 26 - U.S. options on ETFs: comparing U.S. and European markets" provides an insightful comparison between options markets in the U.S. and Europe, with a particular focus on U.S. ETF options. Koen and Peter discuss how U.S. ETF options offer traders unique opportunities and why these markets are gaining popularity among options traders.

You can listen here on the podcast-site if you don't see the player above  

 

Understanding the U.S. options market

  • High volume trading: U.S. options markets see over 40 million contracts traded daily, with ETFs accounting for half of the turnover. This level of activity provides unparalleled liquidity for options traders.
  • Key ETF options: Popular ETFs like SPDR (SPY) and Nasdaq 100 (QQQ) are actively traded, offering narrow bid-ask spreads and strategic trading opportunities for investors.

Comparing U.S. and European options

  • Physical delivery vs. cash settlement: U.S. ETF options offer physical delivery upon expiration, while European index options settle in cash.
  • Market differences: U.S. markets boast more liquidity, narrower bid-ask spreads, and a wider range of tools and indicators available to options traders, making them more attractive for active trading.

Exploring sector ETFs

  • Diversification opportunities: Sector ETFs, covering industries like financials, biotech, and technology, allow traders to diversify their portfolios with fewer risks than trading individual stocks.
  • Lower volatility: Sector ETFs generally have lower volatility than individual stocks, making them ideal for strategies such as selling covered calls and cash-secured puts.

The wheel strategy

  • A cyclical approach: Investors frequently use the wheel strategy, where they sell out-of-the-money puts, collect premiums, and potentially get assigned shares. Once assigned, they sell covered calls on the stock, repeating the cycle to generate returns while managing risk.

Why listen to episode 26? For traders and investors looking to explore the benefits of U.S. ETF options and gain a better understanding of the differences between U.S. and European markets, Episode 26 of 'Saxo Options Talk' is essential. Packed with practical advice and expert insights, this episode will help you navigate the U.S. options market and refine your trading strategies.

Subscribe and stay ahead

Ensure you don't miss this insightful episode by subscribing to 'Saxo Options Talk' on Podbean, or on Spotify. Keep yourself updated with the latest strategies and discussions in options trading.

Join the discussion

After tuning in, join me on my X profile or my Threads profile to share your thoughts and insights on the episode. It's an excellent platform for engaging with fellow traders and enhancing our collective understanding of options strategies.

Your questions, our answers

We're eager to hear from you! Send your options-related questions to optionquestions@saxobank.com. Selected questions will be addressed in future episodes, providing customized advice and insights.

Conclusion:

"Episode 26 - U.S. options on ETFs: comparing U.S. and European markets" equips traders with the knowledge to make informed decisions when trading U.S. ETF options. Koen and Peter’s expert insights and practical tips provide a comprehensive guide to understanding the benefits, risks, and opportunities of ETF options trading. Tune in to transform your trading strategies and maximize your investment potential in the U.S. markets.

Previous episodes of the "Saxo Options Talk" podcast
Previous "Investing with options" articles
Previous "What are your options" articles
Other related articles
Why options strategies belong in every trader's toolbox
Understanding and calculating the expected move of a stock ETF index 
Understanding Delta - a key guide for Investors and Traders

Options are complex, high-risk products and require knowledge, investment experience and, in many applications, high risk acceptance. We recommend that before you invest in options, you inform yourself well about the operation and risks. In Saxo Bank's Terms of Use you will find more information on this in the Important Information Options, Futures, Margin and Deficit Procedure. You can also consult the Essential Information Document of the option you want to invest in on Saxo Bank's website. 

Quarterly Outlook 2024 Q3

Sandcastle economics

01 / 05

  • Macro: Sandcastle economics

    Invest wisely in Q3 2024: Discover SaxoStrats' insights on navigating a stable yet fragile global economy.

    Read article
  • Bonds: What to do until inflation stabilises

    Discover strategies for managing bonds as US and European yields remain rangebound due to uncertain inflation and evolving monetary policies.

    Read article
  • Equities: Are we blowing bubbles again

    Explore key trends and opportunities in European equities and electrification theme as market dynamics echo 2021's rally.

    Read article
  • FX: Risk-on currencies to surge against havens

    Explore the outlook for USD, AUD, NZD, and EM carry trades as risk-on currencies are set to outperform in Q3 2024.

    Read article
  • Commodities: Energy and grains in focus as metals pause

    Energy and grains to shine as metals pause. Discover key trends and market drivers for commodities in Q3 2024.

    Read article
Disclaimer

Saxo Capital Markets (Australia) Limited prepares and distributes information/research produced within the Saxo Bank Group for informational purposes only. In addition to the disclaimer below, if any general advice is provided, such advice does not take into account your individual objectives, financial situation or needs. You should consider the appropriateness of trading any financial instrument as trading can result in losses that exceed your initial investment. Please refer to our Analysis Disclaimer, and our Financial Services Guide and Product Disclosure Statement. All legal documentation and disclaimers can be found at https://www.home.saxo/en-au/legal/.

The Saxo Bank Group entities each provide execution-only service. Access and use of Saxo News & Research and any Saxo Bank Group website are subject to (i) the Terms of Use; (ii) the full Disclaimer; and (iii) the Risk Warning in addition (where relevant) to the terms governing the use of the website of a member of the Saxo Bank Group.

Saxo News & Research is provided for informational purposes, does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. No Saxo Bank Group entity shall be liable for any losses that you may sustain as a result of any investment decision made in reliance on information on Saxo News & Research.

To the extent that any content is construed as investment research, such content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication.

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments.Saxo Capital Markets does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo Capital Markets or its affiliates.

Please read our disclaimers:
- Full Disclaimer (https://www.home.saxo/en-au/legal/disclaimer/saxo-disclaimer)
- Analysis Disclaimer (https://www.home.saxo/en-au/legal/analysis-disclaimer/saxo-analysis-disclaimer)
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)

Saxo Capital Markets (Australia) Limited
Suite 1, Level 14, 9 Castlereagh St
Sydney NSW 2000
Australia

Contact Saxo

Select region

Australia
Australia

The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit www.home.saxo/en-au/about-us/awards

Saxo Capital Markets (Australia) Limited ABN 32 110 128 286 AFSL 280372 (‘Saxo’ or ‘Saxo Capital Markets’) is a wholly owned subsidiary of Saxo Bank A/S, headquartered in Denmark. Please refer to our General Business Terms, Financial Services Guide, Product Disclosure Statement and Target Market Determination to consider whether acquiring or continuing to hold financial products is suitable for you, prior to opening an account and investing in a financial product.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Saxo Capital Markets does not provide ‘personal’ financial product advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo Capital Markets does not take into account an individual’s needs, objectives or financial situation. The Target Market Determination should assist you in determining whether any of the products or services we offer are likely to be consistent with your objectives, financial situation and needs.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the US and other countries. AppStore is a service mark of Apple Inc.

The information or the products and services referred to on this website may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and Services offered on this website is not intended for residents of the United States and Japan.

Please click here to view our full disclaimer.