Cboe to Launch S&P 500 Equal Weight Index Options
Cboe Global Markets, a leading derivatives and securities exchange, announced plans to introduce options on the S&P 500 Equal Weight Index (EWI) starting April 14, 2025, subject to regulatory approval. The announcement was made at the 50th International Futures Industry Conference in Boca Raton, Florida.
Details of the New Options
- Options will be cash-settled.
- They will be based on one-tenth the value of the S&P 500 EWI.
- The S&P 500 EWI contains the same companies as the traditional S&P 500, but each firm is assigned an equal weight of 0.2% at each quarterly rebalance.
Differences from the Traditional S&P 500 Index
The equal-weight structure aims to provide varied exposure compared to the capitalization-weighted S&P 500. For example, as of December 20, 2024, the bottom 400 companies accounted for about 80% of the S&P 500 EWI compared to only 26% in the traditional S&P 500.
“The equity market’s increasing levels of concentration has led to market participants searching for additional tools to manage risk and diversify their exposure,” said Rob Hocking, Global Head of Product Innovation at Cboe.
The launch of these options reflects Cboe’s response to growing demand for diversified risk management tools amid concentrated equity markets.