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SPX Market Structure & Taxes

SPX index options behave differently from equity options: cash settlement, European exercise, Section 1256 tax treatment. These articles cover the market-structure facts that change how strategies are built and taxed. Educational only — not tax advice.

SPX settlement timeline — AM-settled SPX monthlies settle to Friday's opening SET value, PM-settled SPXW dailies to the 4:00 p.m. ET close, both in cash.

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SPX Settlement Explained: AM vs PM, Cash Settlement, SPXW

SPX settlement, explained: in-the-money options pay intrinsic value × $100 in cash at expiry. Monthlies settle AM to SET; SPXW dailies PM at the close.

14 min read

SPX vs SPY options comparison — one SPX contract equals ten SPY contracts in notional, cash vs physical settlement, with XSP as the 1/10th-size bridge.

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SPX vs SPY Options: Size, Settlement, Taxes — and XSP

SPX vs SPY options: SPX is ~10× larger, cash-settled, European-style, taxed 60/40. SPY delivers shares and can assign early. XSP bridges at 1/10 size.

12 min read

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