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Description

The Midland WTI American Gulf Coast American-style Option Contract is based on the underlying Midland WTI American Gulf Coast Futures Contract (HOU) and if exercised will result in a corresponding futures position. The contract is for American-style exercise, allowing the buyer to exercise an option any time up to the expiry day.

Market Specifications

Trading Screen Product Name

Midland WTI Futures

Trading Screen Hub Name

Midland WTI

Hedge Instrument

The delta hedge for the American-style Option is the Midland WTI American Gulf Coast Future (HOU).

Contract Symbol

HOU

Contract Size

1,000 barrels

Unit of Trading

Any multiple of 1,000 barrels

Currency

US Dollars and cents

Trading Price Quotation

One cent ($0.01) per barrel

Settlement Price Quotation

One tenth of one cent ($0.001) per barrel

Minimum Price Fluctuation

One tenth of one cent ($0.001) per barrel

Last Trading Day

Trading shall cease at the end of the designated settlement period for the underlying future on the third Trading Day prior to cessation of trading in the underlying Midland WTI American Gulf Coast futures contract. In the event that the official Exchange holiday schedule changes subsequent to the listing of a Crude Oil futures, the originally listed expiration date shall remain in effect. In the event that the originally listed expiration day is declared a holiday, expiration will move to the business day immediately prior.

Option Premium / Daily Margin

Due to equity-style margining the premium on Midland WTI American Gulf Coast Options is paid / received on the day following the day of trade. Equity-Style Options have no daily Variation Margin payment. The premium on the Equity-style Options is paid/received on the business day following the day of trade. Net Liquidating Value (NLV) will be re-calculated each business day based on the relevant daily settlement prices. For buyers of options the NLV credit will be used to off-set their Original Margin (OM) requirement; for sellers of options, the NLV debit must be covered by cash or collateral in the same manner as OM requirement.

Exercise Procedure

Midland WTI American Gulf Coast Options can be exercised into Midland WTI American Gulf Coast Futures contracts. Options contracts are of American-style exercise, allowing the buyer to exercise call and/or put options up to 17:00 hours (London time) on any Trading Day (except on expiry day) during the life of the contract, by giving an exercise notice to ICE Clear Europe in respect of such options. On expiry day, automatic exercise settings are pre-set to exercise call and put option contracts that are one minimum price fluctuation or more in-the-money and call option contracts which are at-the-money with reference to the corresponding daily settlement price at the designated settlement time as determined by the Exchange. At-the-money put options will be abandoned and call options will be exercised.

Strike Price Increments

This contract will support Custom Option Strikes of $0.01/bbl above and below the at-the-money Strike Price. Strike price boundaries are adjusted according to futures price movements. The at-the-money strike price is the closest interval nearest to the previous business day's settlement price of the underlying contract.

Contract Series

Up to 108 consecutive months

Business Days

US business days.

MIC Code

IFEU

Clearing Venues

ICEU

Related Products

• WTI American-Style Options

Trading Hours

Codes