Expanding their equity offering, Saxo Bank has announced the launch of stock options trading on its platform. The new product adds to their existing offering of options products, which includes FX, Equity Index and Commodity assets. Stock options trading also occurs shortly after Saxo Bank announced that it had connected to the IEX equity trading venue, becoming the first European-based online broker to do so.
Upon its launch, Saxo Bank is offering trading in options of 200 of the more liquid stocks from around the world, comprising the top 50 US stock options and ETF options, 100 top European stock options, the top 20 Hong Kong stock options, and 30 top Australian stock options. Saxo expects to expand to 350 stocks over the rest of the year. Similar to other asset types, options will be made available to customers for trading from a single account type, with the ability to use stocks of bonds as collateral for new trades.
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According to Saxo Bank, the launch is based on meeting demand for options trading as they stated in their public statement, “The launch reflects the growing appetite for stock options among both institutional and retail investors as indicated by the 6.4% rise in the number of derivatives traded on-exchange (ETDs) in 2013. In particular, recent market volatility has provided attractive investment opportunities for options traders, and investors are becoming more aware of how they can hedge their exposure in asset classes such as equities or as a means of locking-in existing gains.”
Commenting to Forex Magnates about the launch, Patrice Hénault, Futures & Listed Options Product Manager, alluded to the strength in global equity prices as a driver in increased customer interest for stock trading products, saying, “Obviously the fact that the US Equity market is up 190% over the last 5 years have definitely created a significant interest in our Equity related Products both cash and derivatives.” In addition to the new options offering, Hénault mentioned that they have been expanding their equity index products as they recently released a CFD Index Tracker of the Portugal 20 (PSI 20). In terms of the current offering, Hénault explained that trades opened by client will be sent directly from Saxo’s platforms “to the listed exchange where the trade is matched against another counterparty and cleared by the exchange.”