Mini Options

What is a Mini Option?

So you've heard about Options by now, but what about a Mini Option? Well as it turns out you can buy, sell, and trade a Mini Option just like a regular option. The only difference is that instead of representing 100 shares in the underlying stock, a Mini Option represents just 10 shares in the underlying stock.

Now why would someone need a Mini Option? Well imagine a stock like Apple which was trading not too long ago at $620 per share! You can imagine that to buy a single option of Apple would cost around $700 per option depending on factors such as time to expiration or how close to the money the underlying stock is currently trading.

Well all things being equal, if that Apple option were a Mini Option, it would cost you about a tenth of the cost, or around $70 per option! Well that's a great deal, but remember that a Mini Option only controls 10 shares instead of the standard 100 shares of a regular option. But if what you're looking for is pure price action and to partake in the percentage increase in value, a Mini Option could be right for you.

The catch is you cannot buy Mini Options for all stocks. As of March 18, 2013 only five securities have been authorized to trade Mini Options. Those are described below: You can be sure that as demand for Mini Options increases, more will be available. You can keep checking back here to find out the status!
SPDR S&P 500. (SPDR is prounouced 'Spider').
SPDR Gold Trust
Google, Inc.
AMZN, Inc.