What are Index Options?

The Index Options are options contracts where the underlying is an Index e.g. Nifty 50 or S&P BSE Sensex. Each index option is a group of stocks collected based on some theme. Each stock has a weight attributed in the index according to which the price of the index is calculated.

Index Options have their own lot size, strike prices and expiry dates. All index options have a 3 month expiry cycle including 1, 2 and 3 month.

Index Options Benefits

Investing in index Options comes with various benefits like-

• Provides broader exposure with a single trade

• Diversification that leads to better risk management

• Lowers trading costs and risks

• Lowers volatility associated with the trade

Examples of Index Options in India 

• Nifty 50 Index Options
• NSE Bank Nifty Index Options
• NIFTY IT Index options
• NIFTY Infra Index options
• NIFTY PSE Index options
• NIFTY MID50 Index options
• FTSE 100 Index options
• S&P BSE SENSEX Index Options
• BSE SENSEX MINI OPTIONS
• BSE TECK OPTIONS
• BSE BANKEX OPTIONS
• BSE OIL & GAS OPTIONS