Are you a fan of trading options on the SPX, NDX, VIX, as well as many other popular CBOE products? If so,  these are proprietary products, meaning that they only trade on one exchange–the CBOE, and are subject to an additional fee when opening and closing a trade.


Sections


Why is there an additional fee to trade CBOE products?

CBOE charges customers an additional fee to trade products that solely trade on their exchange. The Proprietary Index Option fee is assessed on orders on a per contract basis and is passthrough. Proprietary Index Options fees are in addition to clearing and regulatory fees that apply to all opening and closing orders.


What products are subject to the fee?

$0.65 fee per contract
SPX S&P 500 Index
VIX CBOE Market Volatility Index


$0.40 fee per contract
OEXS&P 100 Index (American-style exercise)
XEOS&P 100 Index (European-style exercise)


$0.25 fee per contract
MXEAMSCI EAFE Index
MXEF MSCI Emerging Markets Index
SIXB Materials Select Sector Index Options
SIXC Communication Services Select Sector Index Options
SIXEEnergy Select Sector Index Options
SIXIIndustrials Select Sector Index Options
SIXMFinancial Select Sector Index Options
SIXRConsumer Staples Select Sector Index Options
SIXRE Real Estate Select Sector Index Options
SIXTTechnology Select Sector Index Options
SIXUUtilities Select Sector Index Options
SIXV Health Care Select Sector Index Options
SIXY Consumer Discretionary Select Sector Index Options


$0.18 fee per contract
DJX Dow Jones Industrial Average Index 1/100
NDX NASDAQ 100 Index
RUT Russell 2000 Index



Option Round Trip Example of Proprietary Index Fee (SPX order)

Let's use an example of a short 2-lot SPX -3000/+3020 call spread sold for a $9.00 credit. In total, there are a total of 4 contracts–2 short contracts and 2 long contracts. Since the fees assessed on options buys and options sales differ, the example below will break down the commissions and fees charged per leg. The proprietary index fee is handled the same manner when trading other CBOE products such as NDX, RUT, VIX, etc. 


To view a complete breakdown or our commissions and fees, please click here.


SPX Trade Example

  • 2 short 3000-strike Call: $30.50 credits
  • 2 long 3020-strike call: $21.50 debit

Total Credit Received: $9.00 per spread


Cost to Open

Sell to open: -2 short 3000-strike calls

  • Commission: $2 ($1/contract)
  • Clearing: $0.20 ($0.10/contract)
  • ORF Fee: $0.08 ($0.0388/contract)
  • SEC Fee: $0.13 ($0.0000207 x 2 x 100 x $30.50)
  • Proprietary Index Fee: $1.30 ($0.65/contract)

Total: $3.71


Buy to Open: +2 long 3020-strike call

  • Commission: $2
  • Clearing $0.20
  • ORF Fee: $0.08
  • Proprietary Index Fee: $1.30 

Total: $3.58


The total cost to OPEN the spread: $7.29 ($4 commission + $3.29 in fees)


Cost to Close

Three-weeks later, the position is closed for a $3.00db, resulting in a $6.00 profit per spread.

  • 2 short 3000-strike Call: $6.00 debit
  • 2 long 3020-strike call: $3.00 credit

Total Debit: $3.00 per spread ($600 total debit paid to close)


Buy to Close: -2 short 3000-strike calls

  • Commission: $0 
  • Clearing: $0.20 ($0.10/contract)
  • ORF Fee: $0.08 ($0.0388/contract)
  • Proprietary Index Fee: $1.30 ($0.65/contract)

Total: $1.58


Sell to Close: +2 long 3020-strike call

  • Commission: $0
  • Clearing $0.20
  • ORF Fee: $0.08
  • SEC Fee: $0.01 ($0.0000207 x 2 x 100 x $3.00)
  • Proprietary Index Fee: $1.30

Total: $1.59


The total cost to CLOSE the spread: $3.17 ($0 commission + $3.17 fees)