US Stock Options Smash Record, Surpassing 10 Billion Contracts

The boom in stock market options shows no sign of let up, as the number of traded US contracts surpassed the 10-billion mark in 2022 for the first time ever, playing a role in the biggest equity rout in over a decade

For the third straight year, contracts in US single-stock and index options set a record, more than doubling from the level three years ago.

The options frenzy was a major feature in a year when the Nasdaq 100 Index fell 33% and the S&P 500 shed 20%.

As the mood soured, trading in “puts” — contracts allowing holders to sell — soared by more than 30% compared to 2021, while that in bullish “call” options declined 12%.

Another feature was the explosive growth in very short-term contracts, sometimes maturing within 24 hours. Pinpointing exact volumes can be tricky but S&P 500 options expiring within one day comprised more than 40% of total volume over the third quarter, almost doubling from six months before, Goldman Sachs estimated.