I'm interested in international markets. Especially UK, Australia, Russia. For these or any other market, Are the exercise styles European? At expiration, auto-exercised if ITM? Any surprises or gotchas coming from America? Any suggested websites, web-screeners, data sources, software, etc?
Not sure on Uk however I live in AUZ and I'm pretty up to date with our local options. Only please don't laugh when you see our strike prices, they are the most confusing things I've ever seen before. You won't see much trading out side of our top 10 stocks and the main index. This is the S&P ASX 200. The ticker for this code is XJO. It is traded on the ASX. There is the SFE (Sydney futures exchange) and this does have some volume on the future options for our 3yr and 10yr interest rates. Dunno about UK, however if you are interested in Euro are options then you will want to look at FESX, BUND and options over the top 10 stocks in German, French and obviously UK. Funny thing is with the French stocks, they are all these fasion brands. Made me laugh because the top 10 here is AUZ are all mining / banking. Auz has both Euro and 'merica style exercise. Dunno about the auto-exercise. Look it up on the ASX website. Comming from 'merica the local options here are MUCH less prone to IV swings..... and I mean MUCH!! ( for the stocks anyway ) I traded here for about 1 year and I didn't even know what IV was / is. However once I started trading options in 'merica I to learn about IV... and real quick to . Everything for Auz you can find on the ASX website. www.asx.com.au. Its a pretty big website with a lot of information. .
If you are US based some international option markets are unavailable because they lack SEC approval. This is usually a matter of a reciprocal surveillance agreement, but it can be more complicated than that. Institutional size investors are generally OK. Depending on marketplace the minimums can be quite steep. Eurex covers a number of markets, in addition to their local exchanges and none of their single equity names are available to non-institutional investors at this time. Our desk trades the UK and a couple EU country options and besides the fact that you work nights and many holidays you'll need lots of capital, a good quoting source, a relationship with a EU based bank and most single names equities are really thinly traded.
Hi CBC, what platform do you use to trade AUS options? And how are you finding the liquidity and ease of opening and closing positions?
FTSE index for the UK is pretty liquid (not as any American index though). My personal suggestion would be to trade also German DAX or European Stoxx50. Both are also liquid and their ATM IVs are usually higher than SP500 or RUT. All these are european style options, no auto-exercised if ITM. Check Eurex website for further info. http://www.eurexchange.com/exchange-en/products Unfortunately Options trading is far less developed in Europe compared with US, which means there are few (if any) web-screeners or SW widely available. Good luck!
BTW, any suggestion on APAC indexes for option trading? (on top of Aus XJO already mentioned on this thread). What about Japan´s Nikkei, HongKong´s Hang Seng or India´s Nifty?
Russia has a small derivatives market. Most active options are options on futures on RTS index and USDRUB pair. =Are the exercise styles European? No, American. =At expiration, auto-exercised if ITM? Yes. =Any surprises or gotchas coming from America? 1. The language might be a problem. Not sure that all the questions are covered in English. 2. Minimum price steps are very small. 3. All options are of a futures type, not up-front. This is good from my point of view. 4. The exchange translates its own IV smile into a data feed. 5. Margin system is ideologically close to the SPAN, but it is not the SPAN. 6. Options on futures only, no equity options, no ETFs etc. =Any suggested websites, web-screeners, data sources, software, etc? All these will be in Russian. Ask me any questions, I'm in the subject.