Chicago Board Options Exchange (CBOE), the largest U.S. options exchange, today said it will introduce options contracts on the FTSE Emerging Index. Building on the success of the Russell 2000 options, the next month’s listing on the CBOE market will make these options available for trading to the broad derivatives community effective September 26, 2016.
Through the new offering, investors will have at their disposal a wider range of instruments and possible strategies to invest in approximately 972 securities from 22 countries, covering a range of industries from commodities to banking and technology.
The FTSE Emerging Index is a market capitalisation-weighted index of large- and mid-cap companies in multiple emerging markets in Europe, Asia, Africa, Latin America and the Middle East.
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The FTEM options, which complement the existing future and ETF contracts based on the FTSE Emerging Index, offer institutional and retail investors a new way to obtain, manage or hedge exposure to the most liquid companies in the global emerging markets.
The extension of the product offering is part of a licensing agreement between CBOE and London Stock Exchange Group (LSEG), signed in February 2015, which made CBOE the exclusive U.S. provider of cash-settled index options on more than two dozen LSEG-owned FTSE Russell indexes. Furthermore, it allowed the two companies to collaborate on the development of additional index options products and investor education globally.
The Russell Indexes are a diverse family of domestic and global equity indices that allow investors to track the performance of distinct market segments worldwide. In addition, U.S. exchange traded funds (ETFs) tracking FTSE Russell indexes comprise some of the most actively traded ETFs globally.
Commenting in the press release, CBOE Holdings CEO Edward T. Tilly said: “We are pleased to expand our FTSE global offerings with the launch of these new options on the FTSE Emerging Index, which give both our domestic and international customers the ability to trade and hedge exposures to an interesting and often volatile segment of the global equity marketplace.”