Options Price Reporting Authority: What it is and how it Works

What is Options Price Reporting Authority (OPRA)?

The Options Price Reporting Authority (OPRA) is a centralized securities information processor (SIP) that consolidates and disseminates real-time options market data from multiple U.S. options exchanges. It ensures transparency and standardized reporting of options trades and quotes across markets, supporting regulatory compliance and informed trading decisions.

OPRA operates under a joint plan approved by the SEC, coordinating data from major exchanges to provide a unified feed for index, ETF, and single-stock options, distinct from proprietary exchange feeds. This system is critical for brokers, traders, and vendors requiring accurate and timely options pricing data, similar to how JPMorgan leverages consolidated market information for institutional strategies.

Key Characteristics

OPRA's core features enable efficient, reliable options market data distribution:

• Centralized Data Collection: OPRA receives last-sale reports, bid/ask quotes including the National Best Bid and Offer (NBBO), open interest, and index values from participant exchanges.
• Participant Exchanges: Includes major U.S. options markets such as CBOE, NYSE Arca, and Nasdaq, ensuring broad market coverage.
• High-Speed Data Feeds: Processes millions of messages per second, reflecting large volumes driven by extensive strike prices and active trading.
• Regulatory Oversight: Operates under SEC rules as a national market system plan, providing a compliant, authoritative source of options data.
• Revenue Sharing: Distributes fees collected from data vendors and users among participant exchanges.

How It Works

OPRA functions by aggregating real-time options market data through a centralized processor managed by the Securities Industry Automation Corporation (SIAC). Exchanges submit trade and quote information continuously, which SIAC consolidates into standardized data streams distributed to vendors and end-users.

This process enables brokers and platforms to provide consistent and accurate options pricing, supporting trading strategies and risk management. For example, platforms offering ETFs like IVV rely on OPRA data to present precise options chains that reflect current market conditions.

Examples and Use Cases

OPRA's consolidated data is vital in diverse market scenarios and for various market participants:

• Equity Options: Traders monitor options for companies like Visa using OPRA data to assess liquidity and price movements in real time.
• ETF Options: Market makers and investors use OPRA's feeds to price options on popular ETFs such as SPY, enabling efficient hedging and speculative strategies.
• Volatility Trading: Exchanges like CBOE utilize OPRA to provide transparent quoting on volatility instruments, aiding traders who focus on volatility indexes.

Important Considerations

While OPRA offers comprehensive options market data, users should consider the infrastructure required to handle its high message volumes, especially for direct access. Many traders and brokers opt for vendor feeds that filter and simplify data delivery.

Additionally, OPRA data excludes futures options, so if your strategy involves those instruments, alternative sources must be used. Understanding the distinction between OPRA and proprietary exchange feeds helps you navigate data costs and latency effectively.