The "daily Call" From Option Alpha: Options Trading | Stock Options | Stock Trading | Trading Online

Hey everyone. This is Kirk here again from Option Alpha and welcome back to the daily call. Today, we're going to be talking about why are SPX and ES different prices. If you are a trader and you start trading in the broad markets, you'll likely come across these two ticker symbols. SPX represents the S&P 500 index and ES represents the E-mini futures, also commonly referred to a /ES when you’re trading in your broker platform, but it represents the E-mini futures on the S&P 500 index. Many people get confused because they look at both of these and they think to themselves, “Okay. Well, you have the S&P 500 index, SPX and then you have the futures on the index, so why are there different prices? And more notably, why does the futures contract trade at a little bit of a “discount” compared to the SPX contract itself?” Here's what you have to understand. The SPX is an index. You can't actually trade it. There's no tradable security. Just like what we looked at yesterday with the VIX where you can’t