ANALYSIS: IG to launch first same day options on Magnificent Seven stocks

IG launched late in July the world’s first Tesla same-day option, known in the US as single day to expiry (0DTE) options, and pledged to launch more same day options based on US blue chips.

Elliot Harris, the head of options at IG, said: “In the coming weeks, we’ll be introducing 0DTE contracts on all the Magnificent Seven stocks. Tesla was our first launch given its high volatility and strong popularity with clients. Over the next few weeks, we plan to roll out 0DTE options across the rest of the Mag 7. We may expand beyond that in time, but that’s the immediate roadmap.”

0DTE options have taken off in the US over recent years as retail traders have increasingly used the short-dated products to speculate on movements in equity benchmarks like the S&P 500 index (SPX).

"We’ve seen a significant surge in options trading volumes, mirroring the broader trends observed on major exchanges,” Harris said. “This increase can be traced back to the onset of COVID, when exchange volumes effectively doubled. We experienced a similar trend at IG, with our active options client base growing four- to five-fold since before the pandemic.

“Most of our growth has centred on SPX options, which now represent the largest portion of our book - reflecting where much of the momentum has been across the wider options market.”

The IG head of options said Cboe Global Markets should be credited with leading the charge, having delivered first weekly options then daily options, which now account for over half of the Chicago-based group’s total SPX options volumes.

The single day options phenomenon, which Harris described as “one of the fastest-growing areas in global trading” has yet to establish itself, however, into the more specialised and less liquid single name market.

Harris said: “When it comes to single stock options, we’re not yet seeing the same scale of volume as we do with SPX 0DTE - either on our platform or on exchange. The shortest available expiry for single names on exchange is currently a weekly contract.”

Speaking on Friday, Cboe’s global head of derivatives Catherine Clay said she does not see 0DTE stock options as a threat to the dominance of the 0DTE SPX options, rather they are more akin to exchange-traded fund (ETF) options.

Harris added: “While there are rumours of 0DTE single name options being launched on exchange, we’ve been preparing for this possibility for several months and have proactively moved to deliver such a product ahead of time.”

Europe is keen to expand its options market, which is tiny compared to the US where options trading is on track for its fifth consecutive record year in 2025. European markets traded in June 47.6 million lots of single stock and index options, according to FOW Data, compared to 1.1 billion lots in the US.

European authorities see retail traders as one of many opportunities to boost the bloc’s futures and options markets.

Harris said: “Looking at the broader market, European traders haven’t adopted options at the same pace as their US counterparts, particularly at the retail level. While index options are gaining traction, interest in single name options remains more muted.”

The IG head of options said the broker has seen strong growth in the UK as well as from particularly active client bases in Italy, France and Germany.

Cboe’s European clearing house suggested in November the European retail trading community would benefit from more effective and predictable post-trade and collateral services.

Frankfurt-based Eurex, owned by Deutsche Boerse, said in November the growth of its Euro Stoxx 50 daily options had been “impressive” since their launch in August 2023, adding a fee cut in September last year would propel further adoption.

Eurex’s main 0DTE index option traded 4.2 million lots in the first six months of this year, which was up more than a half on the first half of last year, according to the firm.