CBOE Index Workbench

FLexible EXchange® (FLEX) Options allow users to custom tailor most contract terms and enjoy expanded position limits for exchange-listed equity and index options. FLEX options offer investment professionals, holders of restricted stock, large stockholders, corporations and other types of investors the newest in risk management instruments, especially designed to extend access to customized derivative products. FLEX options provide investors with:

The ability to customize key contract terms, like exercise prices, exercise styles and expiration dates

Virtual elimination of counterparty risk - Guaranteed by The Options Clearing Corporation, a triple-A rated clearinghouse

The price discovery of competitive auction markets

A secondary market to offset or alter positions

An independent daily valuation of prices

Contract guarantee and virtual elimination of trading counterparty risk

For an extensive overview of Equity and Index FLEX options visit the FLEX online resource center or see the FLEX Quick Reference Sheet.

Options involve risk and are not suitable for all investors. Prior to buying or selling options, a person must receive a copy of Characteristics and Risks of Standardized Options, which is available from The Options Clearing Corporation, One North Wacker Dr., Suite 500, Chicago, IL 60606, or by calling 1-888-OPTIONS.

Please note that futures on the CBOE Volatility Index® (VIX®) were introduced in 2004 after the methodology for VIX was changed; please visit www.cboe.com/vix for volatility updates that might not be reflected on this CD-ROM.

This discussion is designed to assist individuals in learning how options work and in understanding various options strategies. This discussion is for educational purposes only and is not intended to provide investment advice. Commissions, taxes and transaction costs generally are not included in the strategy discussions, but can affect final outcome and should be considered. Please contact a tax advisor for the tax implications involved in these strategies.
This discussion has been prepared solely for informational purposes, based upon information generally available to the public from sources believed to be reliable, but no representation or warranty is given with respect to its accuracy or completeness. No statement herein should be construed as a recommendation to buy or sell a security or to provide investment advice. Any profit/loss diagrams refer only to approximate results at expiration. Past performance is no guarantee of future results.

S&P 100® and S&P 500® are registered trademarks of the McGraw-Hill Companies, Inc., and are licensed for use by the Chicago Board Options Exchange, Inc. ("CBOE"). The Russell 2000® Index is a registered trademark of Frank Russell Company. The Nasdaq 100® is a registered mark of The Nasdaq Stock Market, Inc. "Dow Jones SM", "Dow Jones Industrial AverageSM", "Dow Jones Transportation AverageSM," and "Dow Jones Utility AverageSM" are service marks of Dow Jones & Company, Inc. and have been licensed for certain purposes by the CBOE. iSharesSM is a servicemark of Barclays Global Investors. The Goldman Sachs Technology Indexes are the property of Goldman, Sachs & Co. and have been licensed to the CBOE in connection with the trading of options based upon the indexes. Dow Jones & Co., The Nasdaq Stock Market, Goldman Sachs, and McGraw-Hill make no warranties and bear no liability in regard to the trading of index options.VIX®, CBOE Volatility Index® LEAPS®, FLEX®, FLexible EXchange® and OEX® are registered trademarks and Long-term Equity AnticiPation SecuritiesTM and SPXTM are trademarks of the Chicago Board Options Exchange, Inc.

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