1. Different trading forms

On-exchange options: must be listed and traded on the exchange, and the transaction in which the buyer and seller are matched on the Shanghai Stock Exchange and the Shenzhen Stock Exchange is called on-exchange;

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OTC options: Equity subscriptions that can be bought by securities companies or futures companies are called OTC options. The transaction price and volume are determined by negotiation between the two parties.

2. Different ranges of underlying assets

On-exchange options: mainly indexes and index funds (ETFs).

OTC options: In addition to trading indices and ETFs, both Shanghai and Shenzhen stock markets are covered, with a wider and more flexible investment range.

3. Different exercise methods

On-exchange options: European options are executed, which means that both the buyer and seller of the option contract must exercise the option on the expiration date agreed in the contract. The contract period Rights cannot be exercised within this period. However, it can be transferred and sold through the exchange during the period.

OTC options: American options are executed, which is a non-standard contract. This means that the option buyer can exercise the option at any time during the contract period. Among them, the exercise date and exercise method are agreed upon by both the option buyer and seller.

4. Different equity costs

On-the-counter options: On-the-counter options obtain time value and intrinsic value by paying a premium. When the time is closer to the exercise date, the possibility of reaching the target is smaller, and the consumption of time value will accelerate at this time. Therefore, in practical applications, on-market options are more suitable for Kuainiu market

OTC options: OTC options obtain intrinsic value by paying the option premium. Since it is a one-time consumption, there is no need to call for insurance, which means that investors are no longer given the opportunity to sell at a false value. Under the same circumstances, the cost of option premiums is much lower than the cost of premiums, which is more trouble-free. In comparison, off-field players can play equally valuable roles in fast and slow bulls.

5. Different levels of leverage

On-exchange options: Under the same equity cost conditions, the actual leverage ratio of on-exchange options is lower than that of over-the-counter options. And because the on-site costs decrease in time, it is relatively more flexible and can achieve low-cost T0 transactions.

OTC options: Although less flexible, the actual leverage is higher.

6. Different profit methods

On-market options: The profit method is determined by the market. Similar to stock trading, the market is determined by investors. When the final value of the underlying asset is expected to be good and the underlying stock rises, buying orders will increase accordingly, and the premium will rise accordingly. At this time, you can sell it in the market (transfer) according to the latest price of the premium. to make a profit.

OTC options: The profit method is simpler and cruder. The rise of the underlying stock determines the profit from the exercise.

7. Different liquidity

On-exchange options: As time goes by, the closer to the contract delivery period, the liquidity will become worse and the selling will be significant. After all, no one wants to turn the contract into a piece of waste paper.

OTC options: OTC options do not have the above concerns. No matter what the stock market situation is, as long as it is within the contract period, the brokerage, as the obligated party, needs to fulfill its obligations in the contract. The option buyer only needs to Just execute spot buying and selling in the secondary market. Therefore, the liquidity of OTC options is completely sufficient.