SPY vs SPX: Which One Should You Trade?
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- เผยแพร่เมื่อ 8 ก.พ. 2025
- The age-old debate: What is the difference between SPX and SPY? Simple yet so complicated it seems. This video I break it down to the most basic level. Which one is best? Watch to find out!
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Don’t trade SPY, save your money on taxes trade XSP instead. Same as SPX just 1/10 the size like SPY.
I'm looking at xsp however, I'm not seeing the returns match the spx on that index.
Also, there isn't a lot of volume on their options. Just from checking now.
Never worrying about being assigned my SPX options, paying much lower commissions, and the lower taxes it offers far outweighs lower option liquidity.
This is certainly educational, and I thank you for posting such. However, you only covered half of the settlement differences. Sure, one is in cash and the other is in stock, yet as you are obviously aware, the two settle much differently. I am a big proponent of closing your shorts...let them exprire at your own perile.
But sometimes you pay more than it's IV if it were to just expire
SPX options trading is better than SPY or SPDR options because of lower taxations and
almost 90% lower commissions on same turnover contracts
Correct me if I'm wrong. You made the statement that the spreads on SPY are tighter than SPX percentage wise. According to my top of the head calculation, they are about the same between 2 and 3%. Also, if you divide open interest on the SPX by 10 to reflect the cost difference, the liquidity becomes less of an issue.
Thanks for making this video
Wouldn't the tax advantages of SPX be far more beneficial than the better fills of SPY?
If you don't live in America, you don't even have to pay any tax
@@Phoenix56801 i can't imagine...
Great content. Does the tax benefit also apply to SPXL & SPXS?
Thank you. Very helpful and informative video. You’re very good at explaining things in a clear and concise manner.
Just remember that the wash sale rule applies to SPY and not SPX. And the wash sale rule can crush you if you are a very active trader.
would you explain details?
Can I buy options on xsp (like spy)? I can on SPX (I use TOS btw)
Thank u Big dawg
One cannot get a margin call on spx credit spreads -right?
The max loss is defined, and there is no risk of early assignment. I am trying to learn so want to know if this understanding is correct?
Your understanding is correct. I confirmed this with TD support team recently.
Omg.... I hate E*TRADE, but your classes are awesome, so I don’t care what platform you use!
What is the difference in Deltas ? Normally at the money for Spy they are 45-50 deltas what about SPX ?
Does the PDT rules apply to Spx. Does Spx settled automatically the same way as ES?
I believe that short term capital gains is taxed as though it was normal income. So it'll be taxed at whatever your marginal tax rate is. It's not ALWAYS 35%. Like for me, it's quite a bit less than that. I'm in the 22% marginal tax bracket so that's what my short term gains are taxed at.
This is my understanding. I am not a tax professional.
@@21sexy2010 absolutely. Not to get political, but when half the country pays nothing in and actually takes entitlements out. The other half pays all federal taxes, that's the definition of not fair.
🤔 Wander why he is not replying to some comments. Just liked and subscribed. I have same questions. eg the wash sale rule applies to SPY and not SPX? , Hope to get a reply . BTW thanks for the upload. 🙏 Great information. Can someone reply to this, thanks?
SPX average volume trading increased. I think it’s just as liquid as SPY.
Thanks for making this video. I didn’t know about the positive tax implications of SPX!
Do wash sales apply to SPX?
I do not.
@@OptionsMillionaire "I do not" !!!??? you mean you do not know? Would appreciate your reply thanks in advance.
SPX is perfect for multiple strategies b/c it’s cash settled and settling certain spreads ITM on expiry is more profitable than having to closeout SPY at EOD on expiry day. Plus the risk of assignment/exercise/margin calls is zero
Thank you, I am thinking of trading credit spread ITM on SPX. I had wash sales which were very ugly on my account.
@@sundrisworld ah that sucks. Just as I read this reply I saw that I forgot to include that there are no wash sales b/c it’s cash settled.
Another cash-settled one is the XSP which is the mini-SPX… 10x smaller. The liquidity isn’t as great as SPX so it takes a little getting used to for fills but overall it’s just as good as SPX for the same kind of trades but it’s less risk to put on the table. Less risk = better trades due to more confidence b/c most of the time our non-algo human timing for trades tends not to always be on track.
XSP is a great way to grow a small account or just use low risk amounts to repair an account. I do it for the former but no need to for the latter.
@@Obi-Wan_Jkobi Thank you so much, appreciate your reply. 🙏
Does the special Section 1256 treatment apply whether or not your trading account is in your personal name, or in an entity like an LLC or a corp? Very curious about this . . .
Have you ever thought about trading futures instead of SPX or SPY options?
how does ES compare? thx
So, if you held an $SPY option contract longer than 1 year, would you still be taxed with short-term capital gains? Or under that circumstance, would you be taxed with long-term capital gains?
💪🏽 your the man thanks for the knowledge 🙏
Can you trade SPX on Robinhood? If not.. what platform?
Webull
@@billel4984 thank you
I like Power E-Trade too, was originally software built for pro options traders n etrade acquired it in a broker acquisition
$.65 is one way so $1.30 for buying and selling one options contract which makes $260 for 200 SPY contracts.
With a 35,000 account 70,000 with margin, would you prefer one over the other?
Thank you
I trade SPX for credit spread and SPY for naked options
SPX is european Style ..important Difference
That was explained very well.
Aren’t dividends another advantage of SPY?
I actively day trade spy 2-5 DTE. To your knowledge, are their any advantages/disadvantages to taking the same set ups on QQQ? Spreads seem to be just as tight and it also seems to move a bit more, that said there is probably expected volatility with a bigger mover. Your thoughts? I’ve been actively day trading SPY for 2.5 years and became consistently profitable back in June of this year and man the grind was worth it! Would love to take this system and slap it on QQQ if there are no clear disadvantages
Have you tried the SSO, same as the spy but leverage 2:1
Also, SPX doesn't have much gaps but SPY does
CBOE is showing XSP gets Section 1256 -NOT- SPX
SPX does get 1256
hey mbs im mj nice to meet you 😂
I just have to chime in here to say @#$$#$)(@ the government for taxing 35 percent of MY gains.... Cause I'm pretty sure they didn't take 35 percent of my damn risk.... Just saying
long video..
You can’t actually BUY SPX though.. you can buy index funds or ETFs so why is this video comparing the two
Trading options on SPX vs SPY