The Final Electronic Frontier U.S. Exchanges Moving Options to Screens

摘要

Nick Harrison is not happy with the call-around telephone market for options that thrives in Europe. The OTC-style market where participants shop option trades over the telephone and just cross them on the exchange has grown out of the exchanges' early inabilities to handle complex option trades fully electronically. Once liquidity made its way to the call-around market, it stayed there, however, and now if Harrison wants to trade options on Liffe or Eurex, he has to let go of his mouse and pick up the telephone — not to mention, he says, call-around markets are more expensive for the trader and lack transparency. Harrison, a former Chicago Board of Trade and Liffe floor trader who has made a successful transition to electronic trading, wants U.S. exchanges to avoid that trap. He's not alone in that hope, and the Chicago exchanges are making moves to avoid that fate.