How Exchange Listing Rules Affect Requests for New Equity Options
Summary
The discussion explains how traders can ask for options on an unlisted stock, additional strike prices, or longer expirations. It says an exchange may accept suggestions, but a request alone does not guarantee a listing. Stocks must satisfy exchange eligibility criteria, which may include share price, shares outstanding, trading activity, and ownership distribution. A broker may be able to submit a request on a customer’s behalf.
The answers also distinguish exchange-listed contracts from over-the-counter trades. Deep out-of-the-money strikes or expirations beyond listed long-dated options may be more feasible to discuss with a bank or other dealer OTC. One contributor describes requesting finer strike increments and suggests that exchanges may consider reasonable requests, but this is anecdotal and not a promise of availability. The document is practical market-access guidance, not a formal statement of current exchange procedures or requirements.
Key ideas
- Exchange-listed options are subject to eligibility and listing criteria.
- Traders can suggest new underlyings or strike listings to an exchange, sometimes through a broker.
- A request does not ensure that an exchange will list the contract.
- Dealers may discuss contracts with unusual strikes or longer expirations over the counter.
- The examples are anecdotal and do not establish current exchange policy.
Tags
Full text
# How do I request currently unavailable options to be sold? # How do I request currently unavailable options to be sold? How can I request options: - for a certain stock that currently has no options traded? - at a more extreme Strike Price? E.g. if I fancy buying OTM options? - with a farther expiration? - Does the CBOE have a specific email or online form for requesting options? ## Answer by user31928 (score 1) https://quant.stackexchange.com/a/58560 Are the other answers here correct? I called CBOE, and staff answered just like the following. ## Answer by AlRacoon (score 0) https://quant.stackexchange.com/a/58534 - Contact the CBOE or have your broker do it. They will list options if there is sufficient interest. Sufficient interest can often be one trade. - Same as #1. Also, you can trade these deep OTM options OTC. - If the expiry is longer than the LEAPs, they will most likely have to be done OTC. ## Answer by Dimitri Vulis (score 0) https://quant.stackexchange.com/a/58536 1 according to http://www.cboe.com/education/getting-started/quick-facts/options-marketplace > Are there requirements for individual stock issues to underlie exchange-listed equity options? Yes, option exchanges have certain eligibility requirements for stocks to become "optionable." Among the criteria are share price, number of shares outstanding, average daily volume, and "distribution" (i.e. shares outstanding owned by a minimum number of investors). The NYSE and NASDAQ also have their own listing requirements. Although Cboe has staff that is constantly reviewing stocks that are candidates for listing, it is possible that a stock has been overlooked. If you feel this might be the case, you can contact the Cboe and suggest it. It sure sounds like they welcome suggestions, but there's a good chance that if they don't have options now, then it may not meet some eligibility requirements. They even have a way on their web site https://www.cboe.com/aboutcboe/ContactCBOEEmail.aspx?Topic=New+Option+Listing+Requests to contact them to suggest new options. (However it seems that you either need to be a "cboe trading permit holder" or ask your broker to make the suggestions) 1,2,3 - you might have better luck talking to some bank's equities desk about OTC trades. ## Answer by Bob Baerker (score 0) https://quant.stackexchange.com/a/58538 Option exchanges are not going to offer options on a stock just because you want them. They have specific listing requirements that must be met in order for options to be offered. One of my stocks has weekly options from 10/09 through 11/13 that trade in 50 cent increments but the 11/20 monthly expiration only offers 2-1/2 point increments. I e-mailed the CBOE earlier today requesting that they add at least 1 point increments. You can e-mail them from their web site. They tend to add strikes if they are reasonable requests.
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This summary was written by Stratmill's research agent from the original; it is not a copy of the source.