3 ms·
S&P has indices that have options contract directly on them. Which is way more fun! Also, index options enjoy the same better taxation that futures contracts d
by vmception 6y ago
S&P has indices that have options contract directly on them. Which is way more fun!
Also, index options enjoy the same better taxation that futures contracts do, as they are both Section 1256 contracts. Where no matter how long the trade is, 60% of the profits are taxed at long term capital gains rates and the other 40% are taxed at short term capital gains rates.
Gotta read between the lines :) This is a great step for what could be a wildly popular product.
- modeless 6y agoSure, and the futures have been available for a long time already. But an index fund is far simpler and more accessible, and can also be 100% long term capital gains. Most people can't trade options in their 401k.
- vmception 6y agoThey aren't launching an index fund though, so 401K accounts that couldn't hold index options would not benefit in any capacity from this product. This product can only be a reference value and also infrastructure for index options launches.