Options Trading

Take advantage of short term opportunities in markets like the UK 100, SP 500 and Germany 30.

Choose a CFD Trading or Spread Betting account to trade a range of daily, monthly and quarterly Options contracts.

  • Spreads from 4 points
  • Choose from 20+ markets
  • Award-winning platform
Trade Options from just 4 points in market hours

Trade 20+ Options markets

Global Opportunities

Trade Options online

Trade 20+ FX, Indices and Commodities prices online

Share Options

Trade thousands of Share options over the phone

Spreads from 4 points

On Options including the UK 100, US Crude and Gold

Award-winning platform

Voted Best Spread Betting Platform 2017 ADVFN

Trade wherever you are, on our fast, reliable platforms

Customisable charts

16 chart types with 80+ indicators designed to help you perform technical analysis

Award-winning platform

Our powerful technology is designed to suit you, whatever your level of trading expertise

Actionable trade ideas

Our research portal highlights trade ideas using fundamental and technical analysis

Trade anytime, anywhere

Follow the markets on native apps built specifically for your smartphone and tablet
City Index Trading Platform
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Indices

21 global Indices

Shares

4500+ global Shares

Forex

84 FX pairs

Commodities

25+ global Commodities

Other Markets

Bonds, Options and more

Spread Betting and CFD Trading

City Index offers Spread Betting and CFD Trading on Options. Typically UK investors choose
Spread Betting because any profits are free from UK Capital Gains Tax (CGT)*.

Spread Betting

Best for
Tax-free trading in UK*

Trade type
£ per point

Tax
No UK Capital Gains Tax (CGT)
or Stamp Duty*

Trade on
Global Indices, FX, Shares,
Commodities & more

Commission
Commission free

Platform
Web, mobile and advanced platforms

Create Account

CFD Trading

Best for
Hedging

Trade type
Buy/sell CFDs

Tax
No UK Stamp Duty. You do pay UK CGT but losses can be offset against tax*

Trade on
Global Indices, FX, Shares,
Commodities & more

Commission
Share CFDs only

Platform
Web, mobile and advanced platforms

Create Account
Compare our accounts.
Test drive a trading account
Trade Options risk free with a demo account

Why City Index?

With over 1 million trades processed every month, here's why our clients choose
City Index
Create Account
Over 30 years' experience in Spread Betting, FX and CFD Trading
Authorised and regulated by the Financial Conduct Authority (FCA)
Risk management tools to help protect your positions
Trade on multiple platforms and devices
Actionable buy/sell trade ideas from our research portal
Fast, easy payments and secure withdrawals
Create Account

Why trade Options?

Hedge your portfolio

Use Spread Bets and CFDs to hedge your current investment portfolio

Trading opportunity

Use Options to trade on volatility rather than the direction of a market

Flexible trading

Trade daily, monthly and quarterly contracts, strengthening your portfolio

Options strategies

Employ strategies to match your risk appetite

Tax-efficient trading

Pay no UK Capital Gains Tax or Stamp Duty when Spread Betting*

Trade anytime, anywhere

Trade on desktop, close on mobile, our accounts work on multiple devices
Spread Betting with City Index

How to trade Options

Options markets offer traders a wide range of opportunities across markets including Indices, Commodities, FX and Metals.

At City Index you can strengthen your investment portfolio by trading Options with a Spread Betting or CFD Trading account with daily, monthly and quarterly contracts available.

how to trade Options

Learn to trade Options

What is Spread Betting?

Learn to trade Options using our spread betting tutorials

Spread betting

How to analyse markets

How to identify trading opportunities using City Index's research tools

Research tools

How to manage risk

Learn techniques to improve your trading and manage risk effectively

Risk management
Trade Options from just 4 points spread in market hours

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Open an account to begin trading Options

What are Options?

Options are a financial derivative instrument that gives you the right, but not the obligation to purchase or sell an asset at a specified price, known as the strike price, before a certain expiry date.

They differ from futures because there is no obligation on behalf of a trader to take delivery of an asset when the option expires. When you buy an options contract it comes with a premium – this is the price of owning the option. The premium acts a bit like insurance, you pay for the right to exercise the option in the future.

Like futures, options have a limited shelf life – they have a date at which they expire. The advantage of trading options is that they provide the potential for an investor to acquire something cheaper than the market price, or to sell something at a more expensive price than the market is trading at.

Options exist for a broad range of asset classes including stock market indices and commodities.

Types of Option contracts

There are two types of option contracts which can be bought to speculate on the direction of an asset:

Call option
This gives you the right to BUY an asset at a future price. Buyers of a call option are speculating on an increase in the price of the asset. They have the right to buy the asset at the strike price of the contract.

Put option 
This gives you the right to SELL an asset at a future price. Buyers of a put option are speculating on a decline in the price of the asset. They have the right to sell the asset at the strike price of the contract.

Example:

On Jan 1st, the stock price of company ABC is $57 and the premium is $2 for a February 60 Call.  This indicates that the expiration of the contract is the third Friday of February and the strike price is $60

When you buy an option it represents 100 shares so the total price of the options contract is $2 x 100 =$200.

Loss making option
When the stock price is $57 it’s worth less than the $60 strike price.  You have also paid $200 premium.  If the stock price declined further to $55 in the next couple of weeks, you would choose not to exercise the option because you could buy the stock for $5 cheaper per share on the stock market. Overall, you will have lost your premium of $200

Profit making option
If the stock price rose to $67 in 3 weeks, the options contract will have increased and you would be able to sell your option and make a profit.  You would make a profit of $700 minus the $200 premium.  

Exchange traded Options

Options are traded in a standardised format on options exchanges. The largest options exchange in the world is the Chicago Board Options Exchange (CBOE). 

Options trading can also take place directly with another counterparty, this is known as over-the –counter (OTC).

Why use Options?

Options are frequently used by investors to help them manage the risk in their portfolios. For example, an investor with a portfolio of UK shares might buy a put option on the UK 100. This will go up in value as the UK 100 falls.

Options can be more flexible than futures, as they come in both buy (call) and put (sell) versions, plus it comes down to the trader to decide when to exercise them. The premium paid for an option can be more cost efficient than a futures contract too.

Trading strategies

There are many different types of trading strategies that traders use to profit and hedge their risk. You can find out about some options trading strategies here.

Options trading with City Index

At City Index we offer a number of options markets using financial spread betting and CFDs. You can see our range of options markets here.