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What You Need to Know About SPX Options Trading Hours

Whether you’re a seasoned options trader or just starting out in it, knowing the trading hours of what you are trading makes all the difference between success and failure. This is the same for SPX options that track the performance of the S&P 500 index. This article will give all the information you need about SPX option trading hours so you can take full advantage of what it offers.

Importance of Knowing SPX Trading Hours

Knowing the trading hours for SPX options is vital for timing your executions. It allows you to determine which times have the ideal liquidity and volatility for your trading strategy. It allows you to manage overnight risk by making you aware when news and events may have a significant impact on the value of the S&P 500 Index outside regular trading hours. And it allows you to determine the best times to execute short-term strategies, like day trading or scalping.

Detailed SPX Options Trading Hours

SPX options has extended global trading hours (GTH) after regular trading hours (RTH), which allow for trading nearly 24 hours a day from Monday through Friday. With this, traders can trade or hedge SPX options conveniently across all time zones.

Here are the specific trading hours for SPX options:

Holidays Observed in SPX Options Trading

During the holidays, there’s usually no regular trading hours or an early close for RTH. Global trading hours may also vary during these days. You can check out the CBOE website for the specific trading hours during the holidays.

The specific holidays observed include:

How Trading Hours Affect Options Pricing, Volatility, and Trading Strategies

Regular Trading Hours

Regular trading hours have the most active trading activity out of all the sessions in the day. It offers traders more significant volume, volatility, and liquidity, leading to more trading opportunities. But these come at the expense of wider bid-ask spreads, higher prices, and more significant risks.

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Global Trading Hours

After and global trading hours often have less trading activity for most assets or derivatives. But the SPX options market has enough liquidity and activity during these hours to make trading worthwhile and profitable. Global trading hours have the highest volumes when there's a major news event, especially when news broke before or after the U.S. regular trading hours.

Trading Strategies for Different Hours

Here are some options trading strategies that you can utilize during different hours of the SPX options’ trading hours. Explore these strategies and see if any of them fit with your goals and risk appetite.

Regular Trading Hours Open

  • Momentum trading: This strategy capitalizes on the continuance of existing trends in the SPX options market. Options are bought with a strike price at a level that the S&P 500 Index is expected to reach.
  • News-based trading: This strategy aims to capitalize on market movements brought about by breaking news released before or in the early hours of RTH.

Midday of Regular Trading Hours

  • Iron condor: This is a strategy that utilizes the sale of out-of-money call and put spreads to profit from the sideways movement of the market. The iron condor is a suitable strategy during the midday trading hours when market volatility stabilizes.
  • Straddles: This involves the purchase of call and put options at the same strike price, aiming to profit from significant price swings. This strategy is the best fit when uncertainty peaks before earnings releases and major announcements.

Regular Trading Hours Close

  • Covered calls: This strategy aims to generate income through the sale of call options against a long stock position. Covered calls are often employed when markets are stable.
  • Protective puts: This strategy involves the purchase of put options to hedge against the decline of stocks held in a portfolio. This is used to protect gains ahead of a market close.

Global Trading Hours

  • After-hours swing trades: This strategy capitalizes on news-driven price changes after market close. This is useful for taking advantage of news that broke after regular trading hours.
  • Pre-market scans: This strategy is in preparation for early regular trading hours. It involves identifying opportunities and entering positions that may be profitable during regular trading hours.

Tools to Help You Trade SPX Options Efficiently

Navigate the SPX options market confidently with All American Group’s options trading toolkit. The cutting-edge features of our platform include:

Opening reference points

Receive the specific price levels and market conditions at the beginning of a trading session. Get the analysis for opening prices, gaps, and initial market movements and sentiment.

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Entry reference points

Get the specific levels for your position in relation to support, resistance, moving averages, or trend lines of the market.

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Morning warning chart

Receive a visual representation of the market’s direction, volatility, and potential opportunities and risks before a trading session.

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Warning strategy

Receive alerts when potential risks, changes in market conditions, or specific events arise, allowing you to adjust your positions, manage risk, or take advantage of emerging opportunities.

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Exit strategy

Get the predefined price points to optimize your profits and limit losses for your position for the given trading session.

All of these features are powered by our trading algorithm that has 93% profitability since its inception in 2020.

Start Your Free Trial with All American Group

Supercharge your options trading with the precision of our cutting-edge algorithm-based options trading strategy. Try it out for 14-days for free and see for yourself how it unlocks consistent profitability for your trades. Click on the link below to start your free trial.
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