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| European-Style Natural Gas Options Contract |
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The cash-settled European-style energy options contracts available solely for clearing offer market participants flexible instruments for managing price risk in the energy markets.
The options contracts allow market participants to negotiate their own strike prices and premiums for an options position on any contract month for which there is an underlying futures contract. The transaction can then be submitted to the Exchange clearinghouse through NYMEX ClearPortsm clearing.
European options are settled only on expiration day. These options contracts are settled in cash and cannot be exercised into the underlying futures contracts, relieving market participants of the need to concern themselves with liquidation or exercise issues.
In other respects, the contracts are similar to the corresponding floor-traded American-style options contracts for light, sweet crude oil; natural gas; heating oil, and gasoline.
The strike prices for all European options will initially be identical to the related floor-traded options contracts, although strike prices will be added on an as-needed basis. Registered users of NYMEX ClearPortsm or brokers can add strike prices by calling customer service before noon each business day for listing on the next Exchange business day. |
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