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US options market: The sky’s the limit — but for how long?
31 March 2010
With a record 3.6bn equity options contracts traded last year and some nine exchanges serving the market by the end of the year, is there room for more growth? Elise Coroneos reports.
Read more:
[US options]
[equity derivatives]
[Nyse Arca]
[Nyse Amex]
[CBOE]
[ISE]
[BOX]
[OCC]
[PHLX]
Since the first standardised equity option rolled off the conveyor belt in the US in 1973, the growth of the industry can safely be described as impressive by almost any standards. Each year, with only 2002 as an exception, the US equity options market has seen growth in the number of contracts it trades.
Going from strength to strength, it has reached one milestone after another, particularly over the last 10 years. No sooner had the US Options Clearing Corporation reported in 2004 that it had cleared a record 1bn contracts that year, than it went on to clear 2bn contracts in 2006.
And in 2009, despite analysts’ predictions that the global financial crisis would create a decline of 15% to 20% in contracts traded, instead the industry recorded another increase, if modest at 0.84%, to clear 3.62bn contracts.
But as the economies of the world recover from...
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