What Specific Financial Derivatives Are Classified as Section 1256 Contracts?

Section 1256 contracts include regulated futures contracts, non-equity options, and foreign currency contracts. Regulated futures are traded on or subject to the rules of a qualified board or exchange.

Non-equity options include options on futures, broad-based stock indexes, and certain debt instruments. Single-stock options and options on narrow-based indexes are generally excluded unless they are dealer equity options.