[TGoldman]

Market index wagers and options are similar in that they're both future contracts based on the value of some underlying security. In this case, a particular market index. I believe the main difference between the two is the payout structure if your prediction is correct. Options allow you to buy/sell at a certain pre-determined level. If the index moves deeper in the money on your option, then you're going to profit even more. A market index wager is just a simple win/lose flat bet. Either the market closes above the level and you win or it closes below and you lose. It doesn't matter how much you win or lose by. The commissions/juice on the transactions is probably different also, but that depends on your bookie/broker. As a disclaimer, I've never actually purchased an option or placed an index futures wager, but that's my intuitive understanding of it. Someone please correct me if I'm mistaken.