What Is a Contract Multiplier? | How Do Options Work?

The contract multiplier is the number that turns an option’s quoted price into the actual dollars that change hands. For a standard US or Canadian equity option it is 100, because one contract covers 100 shares of the underlying stock.

In short: option prices are quoted per share (or per index point), and the multiplier scales them to one contract. A premium of $2.50 on a standard stock option means $2.50 x 100 = $250 per contract. Index options use a dollar amount per index point instead, and contracts can be adjusted to non-standard sizes after splits and mergers.

Standard multipliers

Contract	Multiplier
US equity and ETF options	100 shares
Montreal Exchange equity options	100 shares
Cboe S&P 500 Index options (SPX)	$100 per index point
Montreal Exchange S&P/TSX 60 Index options (SXO)	C$100 per index point (as of November 2026)

Montreal Exchange specifications say one equity option contract represents “100 shares of the underlying Equity Security.” Its SXO index options are European style and cash settled, while equity options are American style with physical delivery. The difference is explained in American vs European options.

Worked examples

A stock option. Maple Widgets Inc. (a hypothetical company) trades at $50. A $50 call quoted at $2.50 costs $2.50 x 100 = $250. If you exercise, you pay $50 x 100 = $5,000 for 100 shares.

Breakeven and profit scale too. If Maple Widgets finishes at $55, the call is worth $5.00, or $500 a contract. Profit: $500 - $250 = $250. Each $1 move in the stock above the strike at expiration is worth $100 per contract.

An index option. An SPX call quoted at 12.00 (index points) costs 12 x $100 = $1,200. Cash-settled index options pay the in-the-money amount times the multiplier instead of delivering shares.

Why the multiplier matters

It sets your real exposure. One contract controlling 100 shares of a $50 stock represents $5,000 of stock exposure, even if the premium was $250. That leverage is discussed in options risks explained honestly.
It sets the cash or shares needed on assignment. A cash-secured put on that stock needs $5,000 set aside, not $250.
It drives position size. Five contracts is 500 shares of exposure.

Adjusted contracts

After a stock split, merger, or special dividend, the clearing house can change a contract’s deliverable so the option’s value is preserved. After a 3-for-2 split, for example, one contract might deliver 150 shares with a strike reduced by a third. Adjusted series often have a different symbol and are easy to misread on a chain, so check the deliverable before trading. Contract adjustments are part of how options markets work.