CME Eurodollar Options on Futures:
q10 By what time must you notify the Clearing House that you wish to exercise an option?
a10 You must notify your clearing firm, and your clearing firm must notify the Clearing House, by 7:00 p.m. The Clearing House can be contacted at 312-207-2525.
q11 By how much does an option have to be in-the-money for automatic exercise to take place at expiration?
a11 Automatic expiration takes place only at expiration and not before. To be automatically exercised at expiration, an option needs only to be in-the-money by the smallest price increment possible (e.g., a quarter tick).
At expiration, all in-the-money Eurodollar options are exercised automatically, in the absence of contrary instructions delivered to the Clearing House.
q12 If you're short an in-the-money option, when will you know you have been assigned? When will you be assigned a futures position?
a12 You will be informed before the markets open on the following business day that you have been assigned, and you’ll be assigned a futures position as of the day the assignment was made. Assignments are made through a process of random selection of clearing firms with open short positions in the specific option.
q13 What is the dollar value of "cabinet" in the Eurodollar options?
a13 Cabinet in Eurodollar options is the minimum premium value of $6.25 or "¼ tick."
q14 What are the rules regarding the listing of 12.5 point strike prices?
a14 Quarterly and Serial options: On the expiration day of options in the March quarterly cycle, strike prices in 12.5-point increments will be listed on the two serial, and next March quarterly option expirations.
For example, on Monday, September 13, 1999 (expiration day for Sep 99 futures and options), 12.5-point strike prices would be listed on October and November serial options, and December quarterly options.
One-year Mid-Curve options ("shorts"): the first quarterly and two serial expirations are eligible to trade in 12.5-point strike price increments at any given time.
q15 Where can I find the performance bond updates and information on the SPAN® system?
a15 The navigation bar on the left has links to both performance bond rates and information about SPAN.
