Index Derivatives - S&P Mid Cap 400
Stock Market
Investing &
Trading System
S&P Mid Cap 400 index futures trading contracts are traded through
an auction-like process, with all bids and offers on each contract made
public. Through this, a prevailing market price is reached for each
contract, based primarily on the laws of supply and demand. This forum is
a useful - and essential - element in a free market economy. You might be
surprised to know that the futures markets are rarely used to actually buy
or sell the physical commodity or financial instrument being traded;
they're used for price estimation, risk management, and for some people,
investment and profit.
The S&P 400 index is a market-weighted
index, meaning that larger firms have more influence on the index's performance
than smaller ones. The average size of a firm in this index is between $1-4
billion. When taken together, the 400 components of the S&P MidCap 400 Index
represent about 7% of the total market value of U.S. equities.
Exchange Traded Funds (ETFs) & iShares, Options & Futures
Trading / Futures Contracts
|
Securities |
Issuer |
Type |
Symbol / Root |
|
S&P Mid Cap 400 Index Fund |
AMEX |
ETF |
IJH |
|
S&P Mid Cap 400/BARRA Growth Index Fund |
AMEX |
ETF |
IJK |
|
S&P Mid Cap 400/BARRA Value Index Fund |
AMEX |
ETF |
IJJ |
|
Mid Cap SPDRSTM |
AMEX |
ETF |
MDY |
|
S&P Midcap 400 |
CME |
Options on Futures |
MD |
|
S&P Midcap 400 |
CME |
Futures |
MD |
|
S&P Mid Cap 400 Index Options Contracts
Options are contracts in which
the terms of the contract are standardized and give the buyer the right,
but not the obligation, to buy or sell a particular asset (e.g., the
underlying stock) at a fixed price (the strike price) for a specific
period of time (until expiration). To the buyer, an equity call option
normally represents the right to buy 100 shares of underlying stock,
whereas an equity put option normally represents the right to sell 100
shares of underlying stock. The seller of an option is obligated to
perform according to the terms of the options contract-selling the stock
at the contracted price (the strike price) for a call seller, or
purchasing it for a put seller-if the option is exercised by the buyer.
All option contracts trade on U.S. securities exchanges are issued,
guaranteed and cleared by the
Options Clearing Corporation (OCC). OCC is a
registered clearing corporation with the SEC and has received 'AAA' credit
rating form Standard & Poor's Corporation. The 'AAA' credit rating
corresponds to OCC's ability to fulfill its obligations as counter-party
for options trades.
iShares are exchange-traded
securities that represent ownership in over 50 different
index funds, each
designed to provide investment returns corresponding to the price and
yield performance, before fees and expenses, of a particular index
compiled by one of five index providers: Standard & Poor’s (a division of
The McGraw-Hill Companies, Inc.), Dow Jones & Company, Cohen & Steers, The
NASDAQ Stock Market, Inc., Frank Russell Company and Goldman Sachs Group.
There is no assurance that the price and yield performance of each
particular index for each fund can be fully matched.
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