Cboe Options Offers Automation for Non-FLEX Index Combo Orders

Cboe Options Exchange (C1), the largest options exchange in the U.S., will introduce automation for non-FLEX (Flexible Exchange Option) complex index option orders that include a “combo” (Combinations) portion (synthetic future) with a ratio up to 8 options to 1 combo on July 9, 2021.

On June 15, 2020, C1 has introduced 8:1 ratio enhancements for FLEX and non-FLEX index combo orders.

According to the exchange’s announcement, a combo is a purchase (sale) of an index option call and sale (purchase) of an index option put with the same quantity, underlying index, expiration date, and strike price. An Index combo order is an order to purchase or sell one or more index option series and the offsetting number of Index combo. Though Cboe accepts complex orders with any ratio, complex orders within certain ratios are afforded certain benefits.

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Currently, complex index option orders that include a combo portion plus at least one other leg and with a ratio only up to 3:1 are eligible for electronic processing. On the effective date, applicable complex index option orders that include a combo portion plus at least one other leg and have a ratio up to 8:1 will be eligible for electronic processing via COA, COB and AIM.

Recently, Fazzaco reported that Cboe has enhanced Cboe Silexx​, a world-class, multi-asset order execution management system (OEMS) that caters to the professional marketplace.