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Diversify Your Trading Portfolio with Cboe’s S&P 500® Equal Weight Index Options
Cboe launched options on the S&P 500 Equal Weight Index (EWI) on April 14, 2025. The new options will be cash-settled, eliminating the complexity of physical delivery and are based on 1/10th the value of the S&P 500 EWI, appealing to portfolios of all sizes.
Read MoreKey Takeaways
- Cboe launched S&P 500® Equal Weight Index Options (Ticker: SPEQX) on the S&P Equal Weight Index (EWI) on April 14, 2025
- Options are based on 1/10th the value of the S&P 500 EWI are cash settled
- Cboe is diversifying their suite of products based on the S&P DJI indices
Cboe launched options on the S&P 500 Equal Weight Index (EWI) on April 14, 2025. The new options will be cash-settled, eliminating the complexity of physical delivery and are based on 1/10th the value of the S&P 500 EWI, appealing to portfolios of all sizes. FLEX options are also offered on the options, providing additional opportunity to diversify trading strategies. S&P 500 EWI options are available during regular trading hours from 9:30 a.m. ET to 4:15 p.m. ET.
Understanding the S&P 500 Equal Weight Index
The S&P 500 Equal Weight Index was launched over two decades ago to measure the performance of equal allocations among S&P 500 constituents. This differs from the traditional S&P 500 Index by allocating a fixed weight of 0.2% to each constituent at each quarterly rebalance, rather than weighting by market capitalization. This equal-weight design offers different exposure to the same constituents of the capitalization-weighted S&P 500 Index. As of December 20, 2024, the bottom 400 constituents made up about 80% of the S&P 500 EWI, compared to just 26% in the S&P 500 Index. The EWI can offer better risk management tools as it is not overly reliant on the performance of a few large companies. By giving equal weight to all sectors, there is less risk associated with any single company’s performance.
Benefits of Trading SPEQX
Cboe’s S&P 500® Equal Weight Index Options (SPEQX) complement Cboe’s S&P 500 Index Options (SPX), one of the most actively traded and liquid options in the world. Traders will get broad-based U.S. equity market exposure with potential favorable tax treatments and hedging flexibility. Plus, SPEQX is cash-settled, European-style exercise, mitigating risk with physical delivery requirements.
Diversifying Choices in Indices and Derivatives
The introduction of S&P 500 EWI options aims to meet the evolving demand for more diverse market exposure tools and is the latest addition to Cboe's suite of products based on S&P DJI indices, which includes Cboe S&P 500 Index Options (SPX), Mini SPX Options (XSP), Cboe S&P 500 Variance (VA) Futures and various volatility indices. Cboe is also developing a futures product on the DSPX Index, subject to regulatory review.
"Investors have long turned to S&P 500 Index options to help address volatility and geopolitical concerns, and by adding S&P 500 Equal Weight Index options to the toolkit, investors can gain broad exposure to the same constituents but with the ability to take a more targeted approach and hedge against idiosyncratic risks,” says Rob Hocking, Global Head of Product Innovation. “S&P Dow Jones Indices has long been an important licensor of Cboe, and we are excited to continue innovating in an evolving market with the timely launch of these options.”
Learn more about the new S&P 500® Equal Weight Index Options here.
There are important risks associated with transacting in any of the Cboe Company products discussed here. Before engaging in any transactions in those products, it is important for market participants to carefully review the disclosures and disclaimers contained at: https://www.cboe.com/us_disclaimers/ . These products are complex and are suitable only for sophisticated market participants. In certain jurisdictions, Cboe Company products are only permitted for investment professionals, certified sophisticated investors, or high net worth corporations and associations. These products involve the risk of loss, which can be substantial and, depending on the type of product, can exceed the amount of money deposited in establishing the position. Market participants should put at risk only funds that they can afford to lose without affecting their lifestyle. © 2025 Cboe Exchange, Inc. All Rights Reserved.
