SEC OKs Pacific Exchange electronic options system
Reuters, 05.14.03, 11:04 AM ET
CHICAGO, May 14 (Reuters) - The Pacific Exchange said on Wednesday it has received regulatory approval for a new electronic trading system that it hopes will strengthen its position in the competitive U.S. equity options market.
The Securities and Exchange Commission gave the thumbs-up for the new system, dubbed PCX Plus, on Tuesday.
The screen-based trading platform will allow members to make markets from the exchange floor or from remote locations, which the exchange hopes will boost liquidity.
The system is set to launch in the fourth quarter.
"PCX Plus is a key element of our business strategy," said Pacific Exchange chairman and chief executive Philip DeFeo in a statement. "Our members are keenly interested in adding advanced trading technology to their operations. It expands our reach and opens our markets to the entire financial community."
The San Francisco-based Pacific Exchange is one of four U.S. options exchanges that still operate traditional trading floors. All four have lost market share over the past few years to the International Securities Exchange, a fast-growing, all-electronic options exchange.
In February this year, the New York-based ISE overtook the Chicago Board Options Exchange to become the industry's largest equity options exchange. The CBOE is still the largest options exchange if index options trading is counted.
Other exchanges, like the Pacific Exchange, are promoting a variety of hybrid business models to combine floor trading with electronic elements. Last July, the CBOE moved toward a hybrid platform that integrates elements of floor and electronic trading.
Options are contracts that give their owners the right to buy or sell stocks at predetermined prices within a set time period.
Copyright 2003, Reuters News Service |
