Exchange Traded Options (ETO) Investment strategies with our specialist advisors.

What are ETOs?

Exchange Traded Options (ETO) are versatile, leveraged derivative securities. ETOs can be used to hedge existing investments, reduce risk or make speculative trades. In addition, because of the flexibility offered by ETOs, investors are able to employ a large range of strategies, from simple to complex, to trade in every market.

how Do ETOs work?

There are two types of ETOs that are the basis for all options strategies, Call Options and Put Options. Both types of Options can be sold (written) or bought (taken).

Call Options

Put Options

Buyers (takers) of Call Options have the right, but not the obligation to BUY a specified volume of an underlying security for an agreed price, on or before a specified expiry date. Buyers of Call Options benefit from limited downside risk, but pay a premium for the option.

Sellers (writers) of Call Options have the obligation to SELL a specified volume of an underlying security for an agreed price up until the expiry of the option. Sellers of Call Options benefit from earning premiums but have unlimited downside risk.

Benefits of Exchange Traded Options

Risks of Exchange Traded Options

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Frequently Asked Questions

ETO trades can be placed by either calling up Gleneagle brokers directly or through our online webiRESS platform.

The minimum order size is one options contract.

Contract sizes are typically for 100 shares.

To calculate value of a premium, multiply the quoted premium by the size of the contract. For example, if Rio Tinto’s option premium is quoted at $0.55, a single contract will be $55 ($0.55 x 100 shares per contract)

From the time you receive a margin call notification, you have 24 – 48 hours to deposit additional collateral. During times of rapid market movements, you may be required to provide additional collateral earlier. Should this be the case, Gleneagle Securities will notify you.