Options

Options trading is a form of derivative trading that allows you to trade on the Australian securities market. There are a number of options strategies which traders can use to help improve the performance of their portfolio. CMC Invest offers a sophisticated and professional solution to options traders. Available on both platforms – standard and Pro – options trading has never been more convenient.

What are Options?

Options are contracts that give the buyer the right, but not the obligation, to buy or sell underlying securities at a predetermined price on or before a specific date. Like warrants, options are listed on regulated exchanges such as the Australian Securities Exchange (ASX), and are specifically referred to as Exchange Traded Options (ETOs).

Options can be traded on several kinds of underlying securities, the most popular being equities (stocks), indices and Exchange Traded Funds (ETFs). There are also many options strategies which can help traders limit their risks and take advantage of market opportunities. Learn more about options here.

Why trade Options with CMC Markets?

Single sign-on account

With CMC Markets, trade Options, International shares and other share trading products using one account on the standard or Pro platform. Our integrated solution was designed with the Active trader in mind, to make your reporting, analysis and execution very easy.

Easy set up and execution of orders

Different tools available on our Pro platform to help you create and execute different Options strategies. You can customise the platform to suit your trading requirements.

Options pay off diagrams and strategy analysis

You can access real time payoff diagrams to help assess your strategy. Once your strategy is complete, you can place a trade using the same module.
Our advanced Options analytics risk tool on our Pro Platform will help you perform ‘what-if‘ scenario analysis on your portfolio’s value in real time by adjusting certain variables.

Options finder and pricing tools

The Options finder tool will help you to filter and build out your Options strategies. Our Options pricing tools will help you estimate margin at the time of placing the order. You can also request for quote from Market makers (RFQ).

Straight Through Processing of Orders

Options orders and order amendments placed through the CMC Markets platform are sent direct to market subject to market integrity filters. This maximises the chance of your orders executing on market.

Online Multi Leg Options Orders

Options and Options/Equity multi leg combination orders can be placed and amended on the platform allowing you to have full control of the order from placement to execution.

What's the difference between our standard and pro platforms?

Competitive Brokerage Rates

You can trade Exchange Traded Options (ETOs) on our fully integrated platform. Both share trading platforms provide you with the tools you need to execute on your Options Strategy. Our Pro platform boasts a professional interface, and is a powerful tool to boost efficiency for active traders.

To open an Options Account with CMC Invest, please complete and return a signed Options Account Application Form Upload your completed and signed form with valid ID documents to the platform, visit Support > File Uploads, or you can email your documents to: stockbroking.forms@cmcmarkets.com

Trade Value	Brokerage (including GST)^
$0 - $10,000	$33.00
Over $10,000	0.33%

Options trading levels

Options orders can be placed on our Standard and Pro platforms. However, to take advantage of complex strategies we recommend you trade on our Pro platform.

Once you have Options enabled in your account, you will need to take our Options quiz to analyse your level of expertise. View the strategies available to each Options trading level, and select the Options quiz level you wish to complete. You can access the Options Trading level quizzes on our standard platform within the ‘Trading Settings’ page under the ‘Settings’ menu, or you can refer to our standard platform quick guide for more details.

Level 1

At Level 1, you are able to trade these strategies:

Long Call Long Put
Long Strangle
Long Straddle
Married Put

Level 2

At Level 2, you are able to trade Level 1 and these strategies:

Buy Write
Covered Call

Level 3

At Level 3, you are able to trade Level 1, 2, and these strategies:

Call and Put Spread
Short Straddle
Short Strangle
Long/Short Split Strike
Long/Short Synthetic
Long/Short Condor
Long/Short Butterfly
Long/Short Calendar Collar

Level 4

At Level 4, you are able to trade Level 1, 2, 3, and these strategies:

Short Call
Short Put
Custom

FAQs

What is Options trading?

Options gives you the flexibility and ability to protect, grow or diversify their position, you can fine tune your risk exposure to meet your appetite.

With a number of strategies and jargon, Options can appear complex however all options strategies work on the same principle. Options allow you to ‘lock in’ a future buy or sell price for an underlying security. The set price you agree on won’t change and it’s this fixed element that smart investors rely on.

Options trading just got more convenient with our fully integrated platform, all the tools you need to create and execute options strategies at your fingertips. Learn more about options trading.

Why trade Options?

There are three main reasons that you may want to trade Options:

Earn income from your share portfolio
You can write options against shares you already own to earn additional income. Whilst this will generate income upfront from the premium, you’ll be obliged to deliver the shares at the agreed price if the option is exercised.
Generate wealth in rising and falling markets
As options are classed as either call or put options, you can generate wealth from rising and falling markets. You can profit from a call option in a rising market by locking in a buy price now and benefiting from the underlying security’s capital growth over time. Or alternatively, you can benefit from a put option in a falling market, by locking in a high sale price before the security’s value falls.
Hedge against share price falls
Options can be used to offset potential falls in share prices by taking put options. This gives you the right to sell your shares at a pre-set price for the life of the option, no matter how low the share price may drop.

How do I open an Options Account with CMC Invest?

To open an Options Account with CMC Invest, please complete and return a signed Options Account Application Form.

Upload your completed and signed form with valid ID documents to the platform, visit Support > File Uploads, or you can email your documents to: stockbroking.forms@cmcmarkets.com

For Non-individual accounts like Trusts and Joint, please have all account holders complete the form and provide copies of ID.

How to trade Options on the CMC Platform?

A simple, cost-effective way to trade a range of assets like shares, commodities or bonds as one package to grow your portfolio.

Once you have Options product enabled in your account, this will be available to trade in both standard and Pro platforms.

Standard platform
You can select Options from the product pop-up menu anywhere on the platform. You can also select Options from under the Products menu.

For more information, view our How to Trade Options on the CMC Invest Standard Platform videos.

Pro platform
The Options finder tool under the product context menu (as shown in figure) will allow you to filter and build different Options strategies. You can select from predetermined strategies from this tool.

Also before placing an Options trade, you can view the strategy analytics from the order ticket. We also have an advanced Options analytics risk tool that will help clients perform a ‘what-if’ scenario analysis on their portfolio’s value by adjusting certain variables.

For more information, view our How to Trade Options on the CMC Invest Pro Platform videos.

Forms and guides

Its important to understand the risks associated with Exchange traded Options trading, we recommend you read and understand the ASX explanatory booklet - Understanding Options Trading, our Exchange Traded Product Disclosure Statement and our Target Market Determination for Exchange Traded Options:

ASX explanatory booklet - Understanding Options Trading

ASX explanatory booklet - Understanding margins

Exchange Traded Product Disclosure Statement

Target Market Determination for Exchange Traded Options

Other forms and documents associated with Options Trading:

Legal Documents (Includes Financial Services Guide and Terms and Conditions)

Options Personal Guarantee Form (Only for company and trust applications where the guarantee form has not already been sighted)

Options Account Application Form

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