The options currently available for trading in the exchange market include 50ETF, 300ETF, soybean meal options, sugar options, copper options, rubber options, corn options, and cotton options. It is expected that more options trading varieties will be launched in the future.
An option refers to a contract that originated in the American and European markets in the late 18th century. The contract entitles the holder to purchase at a fixed price on a specific date or at any time before that date. or the right to sell an asset. The key points of the definition of options are as follows:
1. An option is a right. Options contracts involve at least two parties: a buyer and a seller. The holder enjoys rights but does not assume corresponding obligations.
2. The subject matter of the option. The underlying of an option is the asset chosen to be purchased or sold. It includes stocks, government bonds, currencies, stock indexes, commodity futures, and more. Options are "derivatives" of these underlying assets, so they are called derivative financial instruments. It is important to note that the option writer does not necessarily own the underlying asset. Options can be "sold short." Options buyers may not actually want to purchase the underlying asset. Therefore, when the option expires, both parties do not necessarily make physical delivery of the underlying asset, but only need to make up the price based on the price difference.
3. Expiration date. The day on which the option expires as agreed upon by both parties is called the "expiration date". If the option can only be executed on the expiration date, it is called a European option; if the option can be executed on the expiration date and at any time before, then Called American options.
4. Execution of options. The act of buying or selling the underlying asset based on an options contract is called "execution." The fixed price agreed in the option contract at which the option holder purchases or sells the underlying asset is called the "strike price".
Domestic options development
On February 9, 2015, the SSE 50 ETF option was listed on the Shanghai Stock Exchange, which was the first domestic on-exchange option. This not only announces the arrival of the option era in China, but also means that our country already has a full set of mainstream financial derivatives.
On March 31, 2017, soybean meal options were listed on the Dalian Commodity Exchange as the first domestic futures option.
On April 19, 2017, sugar options were listed for trading on the Zhengzhou Commodity Exchange.
On September 25, 2018, copper options were listed for trading on the Shanghai Futures Exchange.
Since 2019, the domestic options market has developed rapidly. The equity category has expanded to include Shanghai Stock Exchange 300 ETF options, Shenzhen Stock Exchange 300 ETF options and China Financial Futures Exchange 300 stock index options. Commodity options have successively included corn, cotton, gold, etc. Several varieties are on the market.