Amex To Auto-Fill QQQ Option Orders Up To 250 Contracts
Wed Apr 3, 5:08 PM ET
By: Kopin Tan, Of DOW JONES NEWSWIRES
NEW YORK -(Dow Jones)- The American Stock Exchange, starting Thursday, will increase to 250 contracts the size of Nasdaq 100 Tracking Stock, or QQQ, option orders it will quickly fill through its auto-execution system.
Currently, orders of up to 100 contracts in the QQQ options can be routed to the Amex's auto-execution system, which fills small customer orders quickly and electronically.
"Auto-Ex has always been popular with many of our investors, and 100 contracts didn't seem to be a large enough size," said Michael Bickford, the exchange's senior vice president in charge of options. "We saw a demand in the marketplace and thought it was appropriate to increase the limit to 250 contracts."
The increase in size limit was recently approved by the Securities and Exchange Commission (news - web sites).
Options on the QQQ tracking stock were the industry's most heavily traded equity option last year, and by a large margin, with nearly 71 million contracts traded in 2001. While QQQ options first traded at the Amex, other option exchanges began listing it last year. Today, it remains one of the most robustly traded options.
With the move, the Amex takes another step in expanding its electronic trading platform and onto turf carved out by the electronic International Securities Exchange. With trading volume growing at the ISE, many floor-based exchanges have sought to expand their electronic trading capability and have opened up access to their auto-execution networks in one way or another.
The Amex is discussing with its specialist firms about expanding auto- execution in other names besides the QQQ options and could add other option classes soon, Bickford said.
Currently, the Chicago Board Options Exchange's auto-execution system will automatically fill QQQ option orders of up to 100 contracts, a spokeswoman confirmed. The exchange said it, too, is looking into possibly expanding that size limit. |
