Proposed Revision
For US options, a new initiative, led by the Options Clearing Corporation, has been tasked with developing a new symbology for exchange traded options. The proposed revision is meant to address several deficiencies with the standard convention described above. In particular:
- Lack of uniformity for LEAP option convention (i.e. options with maturity greater than one year)
- Use of illogical identifiers for both options and underliers
- Difficulties encountered when rolling LEAP options to standard options as they age.
- Ambiguous naming, such as when options for both 105 strike and 205 strike exist on the same expiration for an underlier.
The new symbology will do away with the letter codes for strike and expiration, and instead employ a 21-byte series key with the following fields:
- Symbol (MSFT, max. 6 characters)
- Yr (06)
- Mo (03)
- Day (18)
- C/P (C)
- Explicit Strike (00047)
- Decimal (500)
All options that settle into the same underlier (e.g. 100 shares of the underlier) will share the same symbol field.
Rollout of the new symbology convention is planned for 2009.
Read more about this topic: Option Naming Convention
Famous quotes containing the word proposed:
“It has been proposed that the town should adopt for its coat of arms a field verdant, with the Concord circling nine times round.”
—Henry David Thoreau (1817–1862)