588 
SUMMARY 
Part V: Index Options and Futures 
This concludes the discussion of index spreading. The above examples are intended 
to be an overview of the most usable strategies in the complex universe of index 
spreading. The multitude of strategies involving inter-index and intra-index spreads 
cannot all be fully described. In fact, one's imagination can be put to good use in 
designing and implementing new strategies as market conditions change and as the 
emotion in the marketplace drives the premium on the futures contracts. 
Often one can discern a usable strategy by observation. Watch how two popu­
lar indices trade with respect to each other and observe how the options on the two 
indices are related. If, at a later time, one notices that the relationship is changing, 
perhaps a spread between the indices is warranted. One could use the NASDAQ­
based indices, such as the NASDAQ-100 (NDX) or smaller indices based on it (QQQ 
or MNX). Sector indices can be used as well. This brings into play a fairly large num­
ber of indices with listed options (few, if any, of which have futures), such as the 
Semiconductor Index (SOX), the Oil & Gas Index (XOI), the Gold and Silver Index 
(XAU), etc. The key point to remember is that the index option and futures world is 
more diverse than that of stock options. Stock option strategies, once learned or 
observed, apply equally well to all stocks. Such is not the case with index spreading 
strategies. The diversification means that there are more profit opportunities that are 
recognized by fewer people than is the case with stock options. The reader is thus 
challenged to build upon the concepts described in this part of the book.