# Option Multiplier Source: SquawkFlow URL: https://squawkflow.com/glossary/option-multiplier Category: Options Basics Published: 2026-08-25 Type: Definition > The option multiplier converts a quoted premium into dollars. It is 100 by convention, it is set by OCC rather than the exchange, and it is not always 100. --- ## The Number That Turns a Quote Into Dollars An option premium is quoted per unit of the underlying, not per contract. The multiplier is what converts one into the other. [Cboe's rulebook](https://cdn.cboe.com/resources/regulation/rule_book/C1_Exchange_Rule_Book.pdf) states the mechanic with an example that does double duty: "a bid of “7” represents a bid of $700 for an option contract having a unit of trading consisting of 100 shares of an underlying security, or a bid of $770 for an option contract having a unit of trading consisting of 110 shares of an underlying security." Read that twice. The first half is the convention everyone knows. The second half is what most explanations leave out: the unit of trading is a property of the particular series, and 100 is a default rather than a law. ## Who Sets It Not the exchange. Cboe Rule 5.2 says "The unit of trading in each series of options traded on the Exchange is the unit of trading established for that series by the Clearing Corporation pursuant to the Rules of the Clearing Corporation and the agreements of the Exchange with the Clearing Corporation." The Options Clearing Corporation defines what the contract delivers; the exchange lists it and trades it. That indirection is why a corporate action can change what a contract is worth without anything visibly changing on your screen except a suffix on the symbol. ## What 100 Does to Everything Downstream Once the multiplier is 100, every other options number inherits it. - A premium quoted at $2.35 costs $235 per contract before fees, and a one-cent move in that quote is $1 per contract. That is why penny-wide markets matter more than they look. - A contract with a delta of 0.30 carries roughly the exposure of 30 shares, not 0.3 shares. The greeks are quoted per share too, and the multiplier turns them into tradeable quantities, our [greeks primer](/learn/options-greeks-delta-gamma-theta-vega) works through the scaling. - 500 contracts of a $2.00 call represent $100,000 of premium and control 50,000 shares. Those are two different numbers describing the same trade, and a feed that uses "premium" and "notional" interchangeably is conflating them. ## When the Multiplier Is Not 100 **Index options settle in cash.** SPX carries a multiplier of 100 in [Cboe's contract specifications](https://www.cboe.com/tradable_products/sp_500/spx_options/specifications/), but the underlying is an index level rather than shares, so one index point is $100 per contract and nothing is delivered at expiration. The rulebook defines an index multiplier as "the amount specified in the contract by which the current index value is to be multiplied to arrive at the value required to be delivered to the holder of a call or by the holder of a put upon valid exercise of the contract." Our [SPX versus SPY comparison](/learn/spx-vs-spy-options-differences) covers what cash settlement changes in practice. **Smaller contracts exist.** The same quoting rule covers mini-options as "an option contract overlying 10 shares" and micro-options as a contract "which has an index multiplier of one", with the rulebook noting elsewhere that "100 micro-option contracts will represent one (1) standard option contract." **Adjusted options are the real trap.** After certain corporate actions the Clearing Corporation establishes an adjusted unit of trading, and quotes are then "expressed in terms of dollars per 1/100th part of the total securities and/or other property constituting such adjusted unit of trading." The rulebook's own illustration is a contract whose unit of trading is "100 shares of an underlying security plus 10 rights." The deliverable can become a mix of shares, cash and other securities, and the strike prices on the chain will still look perfectly ordinary. ## Where This Bites in Flow Reading Every premium figure in every options flow product is price times size times an assumed multiplier, and that assumption is almost always a flat 100. On an adjusted series it is wrong, and the headline dollar figure is wrong with it. Before you act on a large premium print in a name that has recently split, merged, spun off a unit or paid a special dividend, check the actual deliverable. The same caution applies when reading [an options chain](/learn/how-to-read-options-chain) in such a name: the strikes look normal, and the contract behind them is not. *Educational content, not financial advice. See our [risk disclosure](/risk-disclosure).* --- ## Citation Source: SquawkFlow, https://squawkflow.com/glossary/option-multiplier Retrieved: 2026-09-11 00:31 ET Attribution: cite the page URL rather than a copied number. Levels are recomputed every session, so a number without its date is wrong within a day. SquawkFlow publishes market-structure data and education. Nothing here is investment advice, a price target or a recommendation, and we have no order execution.