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ETF Futures and Options

What does ETF Futures and Options mean?

ETF derivatives are derivatives whose underlying assets are ETFs. ETF derivatives can be broadly classified ad ETF Futures and ETF Options. ETF Futures are derivatives to buy or sell a particular ETF on a specified future date at a specified price. ETF options are contracts that give the holder the right, but not the obligation, to buy (or sell) the underlying ETFs at an agreed-upon price on or before a specified date. The holder of ETF options may or may not exercise the option at his discretion.

Futures Knowledge Explains ETF Futures and Options

In ETF futures and options, the transaction may be for actual delivery of fixed quantity of the ETF at the pre- specified price or cash equivalent. Futures and options on popular ETFs are are standardized and transferable. ETF Futures and options contracts are traded at Futures Markets and Exchanges such as CME Group and Eurex.

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