Select Sectors Index Options
The exchange operator Cboe offers options trading on 11 industry sectors that make up the S&P index.
| Select Sector Index Name | Option Symbol | Underlying Index Symbol | Settlement Symbol | Specifications |
|---|---|---|---|---|
| Materials | SIXB | SIXB | SISB | Link |
| Communication Services | SIXC | SIXC | SISC | Link |
| Energy | SIXE | SIXE | SISE | Link |
| Financial | SIXM | SIXM | SISM | link |
| Industrials | SIXI | SIXI | SISIN | Link |
| Consumer Staples | SIXR | SIXR | SISR | link |
| Real Estate | SIXRE | SIXRE | SISRE | link |
| Technology | SIXT | SIXT | SIST | Link |
| Consumer Discretionary | SIXY | SIXY | SISY | Link |
| Health Care | SIXV | SIXV | SISV | link |
| Utilities | SIXU | SIXU | SISUT | link |
In-depth explanation
The Select Sector Index Options of the Chicago Board Options Exchange (Cboe) are an alternative instrument for tracking US industrial sectors. They are aimed in particular at institutional market participants who want to implement sectoral market assessments without having to resort to exchange-traded products or individual stocks.
Alternative to ETFs and individual stocks
Index options on sector indices offer a regulatory-neutral alternative for market participants who are not allowed to or do not wish to hold options on exchange-traded products (ETPs). The focus is not on individual stocks, but on the performance of entire industry segments, which facilitates portfolio management at an aggregated level.
Efficient implementation of sector strategies
The use of index options allows relative value approaches, sector rotations, dispersion or correlation strategies to be implemented without having to accept operational complexity such as shorting ETFs or managing equity baskets. At the same time, directional market expectations can also be precisely mapped - with clearly defined risk and capital deployment.
Larger nominal effect with lower overhead
With a multiplier of 100, Select Sector Index Options enable a comparatively high nominal market exposure. Depending on the structure and trading volume, this can lead to a more efficient cost ratio, for example through lower relative transaction costs compared to small individual positions.
Cash settlement and European exercise style
The options are cash-settled and European in nature, which means that there is no physical delivery of shares or ETFs and no premature exercise or allocation risk. This makes them particularly suitable for structured, predictable strategies with a clearly defined maturity profile.
Tax classification (US context)
In the USA, index options are typically subject to the so-called 60/40 rule in accordance with Section 1256 of US tax law. Gains and losses are treated proportionately as short-term and long-term. The specific tax effect must always be examined individually and depends on the respective investor status.
