Nasdaq Launches Nasdaq-100® Micro Index Options (XND)

Rhea-AI Summary

Nasdaq has introduced Nasdaq-100® Micro Index Options, enabling Main Street investors to access the Nasdaq-100 index more easily and cost-effectively. These options, now available on the Nasdaq PHLX exchange, represent 1/100th of the full index value, allowing for lower entry costs and risk mitigation. The Nasdaq-100, a prominent large-cap growth index, saw over 40% growth last year, with total financial products based on it exceeding $1 trillion. Monthly expirations are currently available, with weekly options launching soon.

Positive

• Launch of Nasdaq-100® Micro Index Options promotes broader access for individual investors.
• Options represent 1/100th of the full Nasdaq-100 index, lowering entry costs.
• Over 40% growth in the Nasdaq-100 index last year highlights its strong performance.

Negative

• None.

Nasdaq empowers Main Street investors to harness the Nasdaq-100 index through options

NEW YORK, April 22, 2021 (GLOBE NEWSWIRE) -- Nasdaq (Nasdaq: NDAQ) today announced the launch of options on the Nasdaq-100® Micro Index (XND), which expands access for Main Street investors to the Nasdaq-100 index in a seamless and cost-efficient way. These new index options are now listed on the Nasdaq PHLX options exchange, and are available on many trading platforms that support index options.

The Nasdaq-100 is one of the world’s preeminent and increasingly popular large-cap growth indexes, with exposure to leading businesses that drive the economy across a broad swath of industries including technology, health care, and consumer staples. As the Nasdaq-100 Index (NDX) continues to outperform the market, the notional size of NDX index options often outsize the reach of individual investors. Nasdaq-100® Micro Index Options address this by representing 1/100^th the full value of the Nasdaq-100 Index, providing investors with a lower notional entry point. This enables Main Street investors to mitigate risk and enhance the yield of the Nasdaq-100 with a new, cost-effective tradable instrument.

“Option investor engagement is at an important inflection point, with newer participants embracing the options market like never before,” said Greg Ferrari, Vice President and Head of U.S. Options for Nasdaq. “The Nasdaq-100® Micro Index Options address this evolving demographic by providing individual investors with a more precise and manageable way to access innovative Nasdaq-100 companies. Our work continues to encourage broader participation in the market and helps investors recognize the benefits that exist when utilizing index options in a portfolio.”

Upon initial launch, Nasdaq-100® Micro Index Options are available for monthly expirations, with weekly expirations set to launch later next month. Additional expiries, including long-term equity anticipation securities (LEAPS) as well as Monday and Wednesday weekly expiries, will be added per customer demand. Index options serve a valuable role for options investors, with the main benefits being cash-settlement, European-style expiration, and favorable tax treatment.

The Nasdaq-100 Index landscape is one of the most liquid index ecosystems in the world and supports liquid futures, options, ETFs, ETF options, index options, index funds, variable and fixed insurance products, and structured products. In total, NDX gained in value by more than 40% last year, with the notional value of all financial instruments that follow the index exceeding $1 trillion.

About Nasdaq
Nasdaq (Nasdaq: NDAQ) is a global technology company serving the capital markets and other industries. Our diverse offering of data, analytics, software and services enables clients to optimize and execute their business vision with confidence. To learn more about the company, technology solutions and career opportunities, visit us on LinkedIn, on Twitter @Nasdaq, or at www.nasdaq.com.

Nasdaq Media Contacts

Matthew Sheahan
(212) 231-5945
matthew.sheahan@nasdaq.com

Ryan Wells
(646) 648-3887
ryan.wells@nasdaq.com

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FAQ

What are the Nasdaq-100 Micro Index Options?

They are options representing 1/100th of the Nasdaq-100 index, aimed at individual investors.

When were Nasdaq-100 Micro Index Options launched?

They were launched on April 22, 2021.

What is the benefit of Nasdaq-100 Micro Index Options for investors?

They provide a cost-effective way for small investors to access and hedge against the Nasdaq-100 index.

What types of expirations are available for Nasdaq-100 Micro Index Options?

Initially, monthly expirations are available, with weekly options to launch soon.

How much did the Nasdaq-100 index grow last year?

The Nasdaq-100 index gained over 40% in value last year.