Option strikes

[Aquarians]

Any idea who decides what the strikes will be for options? The market maker or the exchange?

Coze I saw very strange arrangements:
- Stocks in the $5 range with strike increment of $2.
- And stocks in the $25 range with strike increment of $0.5.

Actually I think I can test On Monday I can try placing a $0.5 or maybe $0.25 increment sell put @ ridiculously high price on that $5 stock and see if it appears in the market data.

 

[.sigma]

I’ve seen weird strikes, in what seems the most random ways.

Calls:
150
155
160.75
165
170

for example..

but none is more bizarre than options on futures.. /ZB futures and what not. I peep at the chain and get the fook out the second I see the quotes lol

 

[guru]

https://www.cboe.com/exchange_traded_stock/equity_options_spec/
https://www.theocc.com/Clearance-and-Settlement/Clearing/Equity-Options-Product-Specifications
===========
Strike Price Intervals: In general, $2.50 increments for strikes below $25, $5 increments for those trading from $25 through $200, and $10 increments for strikes above $200. However, different exchange programs allow for strike-interval listing beyond the standard method.
===========

Any trader can request additional strikes and I requested some in the past and got approved, though not for all the strikes I requested; while there could be other people or reasons to open up additional strikes. At least CBOE looks at and considers such requests.

 

[terr]

... also some strange strike prices may happen because of splits.

 

[JSOP]

https://www.cboe.com/exchange_traded_stock/equity_options_spec/
https://www.theocc.com/Clearance-and-Settlement/Clearing/Equity-Options-Product-Specifications
===========
Strike Price Intervals: In general, $2.50 increments for strikes below $25, $5 increments for those trading from $25 through $200, and $10 increments for strikes above $200. However, different exchange programs allow for strike-interval listing beyond the standard method.
===========

Any trader can request additional strikes and I requested some in the past and got approved, though not for all the strikes I requested; while there could be other people or reasons to open up additional strikes. At least CBOE looks at and considers such requests.

Really? Never knew that. How do you request them?

 

[FSU]

https://www.cboe.com/exchange_traded_stock/equity_options_spec/
https://www.theocc.com/Clearance-and-Settlement/Clearing/Equity-Options-Product-Specifications


Any trader can request additional strikes and I requested some in the past and got approved, though not for all the strikes I requested; while there could be other people or reasons to open up additional strikes. At least CBOE looks at and considers such requests.

This is no longer the case. The CBOE will no longer accept new strike requests from customers, you now must request through your broker and the broker will make the request. This change was made about a year ago.

I have also found that they are much less likely now to approve these requests currently, even when made through your broker. I am currently about 0 for 6 in requests made in the last year. In the past they were much more accommodating.

New-Series-Requests.pdf (cboe.com)

 

[guru]

This is no longer the case. The CBOE will no longer accept new strike requests from customers, you now must request through your broker and the broker will make the request. This change was made about a year ago.

I have also found that they are much less likely now to approve these requests currently, even when made through your broker. I am currently about 0 for 6 in requests made in the last year. In the past they were much more accommodating.

New-Series-Requests.pdf (cboe.com)

Yes, the procedure has changed but it’s still the trader requesting them via their broker, not a broker wanting new strikes.
But I didn’t know they’re much less accommodating. In my case the strikes were quite justified, for example due to some stock shooting up near previous OTM strikes, while in such cases they may just add new strikes anyway. At least at that time I was getting replies from CBOE confirming strike addition(s).