Both of these are cash-settled European-style options.If you want to trade options on the DIAMONDS ETF the symbol is DIA. The DJX index option is an european style option and may only be exercised on the last business day before expiration. Futures contracts with values based on the Dow Jones Industrial Average stock index allow traders to make leveraged bets concerning the future of the DJIA. With regular futures trading, the leverage cuts both ways, so picking the wrong direction with a Dow futures trade can turn into a very expensive loser.
Options on futures allow traders to set up trades with different risk profiles, changing the costs of a trade and putting a limit on the downside risk. Step 1Open an account with a registered commodity futures brokerage firm.