To welcome the options leg of our Spring Semester, NYSE/Euronext just announced the trading of mini options. Starting the 18th of March, traders can take option positions in GLD, SPY, AMZN, AAPL and GOOG with 10 shares underlying each contract rather than the typical 100. The common logic for this is as follows. Say you own 50 shares of Apple ($ 22K) and you wanted to purchase protective puts or sell covered calls. With the minimum contract size at 100 shares, you would have no choice but to over-protect your equity position. With the mini options now you can.
But what it will also bring are the hordes of speculators who can now trade Apple calls at 10-share lots and lose all their money on a dead-cat stock!