The main SOFR lesson uses a futures option. Access it through a broker that supports the relevant CME Group options product, subject to local eligibility and account approval.
Identify the contract
The example uses an option on Three-Month SOFR futures. One full price point is USD 2,500. The futures quote is 100 minus the implied rate: 96 corresponds to 4%. A call benefits from a higher futures price and lower implied rate; a put benefits from the reverse.
Identify the option series, underlying futures month, multiplier, premium quotation and exercise terms. A chart symbol or futures listing alone does not establish an available option quote.
Compare access routes
Compare commissions, exchange and data fees, bid–ask spreads and current open interest. Account permission for shares, spot currency or cryptocurrency does not automatically include options on futures.
A cap, floor or swaption has different rights from an option on a futures price.
Exercise and funding
Confirm whether the selected option creates a futures position or settles financially. Exercise rules vary by series. If a future remains open, it requires margin and can produce further gains or losses after the option trade.
Selling the option to close may preserve remaining time value. Check your broker’s instruction deadlines and closeout policy before holding through expiration.
Option expiry and the futures month
Different option expiries can reference different parts of the SOFR futures curve. A short-dated option need not be an option on the nearest futures contract. Check both dates when choosing exposure to a policy event.
Exercise can leave a futures position active after the option expires. That position is subject to margin and further gains or losses. Broker exercise deadlines and position-closeout policies should be understood before expiration.