Cboe Index Options Minimum Increment Faces SEC Scrutiny
Published Date: 12/22/2025
Notice
Summary
Cboe wants to change the smallest price moves for options on its Magnificent 10 Index to make trading smoother and more precise. If approved, options priced under $3 will move in pennies ($0.01), and those $3 or above will move in nickels ($0.05). This affects traders and investors who deal with these tech-heavy index options, with a decision expected by December 29, 2025.
Analyzed Economic Effects
2 provisions identified: 1 benefits, 0 costs, 1 mixed.
New penny/nickel pricing for MGTN options
Cboe proposed changing the minimum price move for options on the Cboe Magnificent 10 Index to $0.01 for series trading below $3.00 and $0.05 for series trading at $3.00 or higher. The Securities and Exchange Commission is reviewing the proposal and set December 29, 2025 as the date by which it will approve or disapprove the change.
Granular pricing and complex order eligibility
The Exchange says the proposed increments would align MGTN index options with options on the index components and allow trading at more granular prices. The Exchange also states MGTN index options would be eligible for complex order trading with penny executions and for the automated improvement mechanism (AIM) auction.
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