CBOE Index Workbench

SINGLE-STOCK FUTURES

For more up-to-date details on single-stock futures, please visit http://www.cboe.com/Institutional/

Under the terms of the Commodity Futures Modernization Act passed in December 2000, U.S. institutional and individual investors are eligible to trade single-stock futures as of December 21, 2001. Lower margins on single-stock futures can reduce the trading costs for stock investors by lowering capital requirements, and therefore impact your bottom line. Also, there will be the ability to sell single-stock futures short without the uptick requirement that exists for stocks. Another key feature of this product is its operational flexibility and ease. Investors can choose to trade single-stock futures in either their securities accounts or their futures accounts. Securities traders will not need to open futures accounts, futures traders will not need to open securities accounts. Securities brokers will not need futures licenses; futures brokers will not need securities licenses. However, notices of registration may be required.

New Exchange
The Chicago Board Options Exchange® (CBOE®), the Chicago Mercantile Exchange Inc. (CME) and the Chicago Board of Trade (CBOT) have created a for-profit Joint Venture (JV) for the purpose of trading single-stock futures through their electronic systems, CBOEdirect and GLOBEX®2. With the combined expertise in equity derivatives of the world's largest options exchange and the two largest futures exchanges in the U.S., single-stock futures are a logical extension of the exchanges' existing product lines.

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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