Transcript International Development of Futures and Options.day.ppt

International Development of
Futures and Options
Karyn Yamamura
BA 543
May 26, 2005
Overview
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FLEX and Exotic Options
Developed and Developing Markets
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Europe
China
Trading Floor Movement
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Electronic vs Open Outcry
FLEX and Exotic Options
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Flexible Exchange Options (FLEX)
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1993 CBOT
Customization
Exotic Options
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Average Rate (a.k.a. Asian Rate) Option
Barrier Option
Knock-out
 Knock-in
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Basket Option
International Options and Futures
Markets
Buenos Aires Cereal Exchange
Mercado Abierto Electronico SA
Rosario Board of Trade
Buenos Aires Futures Market
Merfox
Wuhan Securities Exchange Centre
Tokyo Grain Exchange
Hong Kong Futures Exchange
Tokyo International Financial Futures
Exchange
Russian Exchange
Shenzhen Mercantile Exchange
Moscow Interbank Currency
Exchange
Niigata Securities Exchange
St Petersburg Futures Exchange
China-Commodity Futures Exchange, Inc
of Hainan
Japan Securities Dealing Association
Moscow Commodity Exchange
Finnish Options Exchange
Kammon Commodity Exchange
Helsinki Exchanges
Kansai Agricultural Commodities
Exchange
Saudi Arabian Monetary Authority
Singapore Commodity Exchange Ltd
Cubu Commodity Exchange
Singapore International Monetary
Exchange Ltd
MATIF
Sapporo Securities Exchange
Commodity Exchange of Ljubljana
Asian Capacity Exchange
Deutsche Terminborse
Yokohama Raw Silk Exchange
South African Futures Exchange
Sydney Futures Exchange
Athens Derivatives Exchange
Amman Financial Market
Spanish Options Exchange
Chinese Gold and Silver Exchange
Society
The Kuala Lumpur Options & Financial
Futures Exchange
Citrus Fruit and Commodity Market of
Valencia
Budapest Commodity Exchange
Malaysia Derivatives Exchange
Madhya Pradesh Stock Exchange
Commodity and Monetary Exchange of
Malaysia
Rosario Futures Exchange
Australian Derivatives Exchange
Securities Exchange of Barbados
Bahia, Sergipe, Alagoas Stock Exchange
MONEP
Brazilian Futures Exchange
Pernambuco and Paraiba Stock
Exchange
The OTC Exchange of India
Mexican Derivatives Exchange
Spanish Financial Futures Market
The Swedish Futures and Options
Market
Minas, Espirito Santo, Brasilia Stock
Exchange
Capital Market Supervisory Agency
AEX-Agricultural Futures Exchange
Swiss Options & Financial Futures
Exchange AG
The Commodities & Futures Exchange
Indonesian Commodity Exchange Board
AEX-Options Exchange
Swiss Exchange
Sofia Commodity Exchange
Financiele Termijnmarkt Amsterdam NV
Italian Derivatives Market
London International Futures &
Options Exchange
Montreal Exchange
Italian Financial Futures Market
Canadian Venture Exchange
Tokyo Commodity Exchange
Winnipeg Commodity Exchange
Maebashi Dried Cocoa Exchange
Bolsa Electronica de Chile
Osaka Textile Exchange
China Zhengzhou Commodity Exchange
Kobe Raw Silk Exchange
Guandong United Futures Exchange
Kobe Rubber Exchange
New Zealand Futures & Options
Exchange Ltd
The Baltic Exchange
Muscat Securities Market
London Metal Exchange
Manila International Futures Exchange
The London Securities and
Derivatives Exchange
Warsaw Commodity Exchange
International Petroleum Exchange of
London Ltd
Oporto Derivatives Exchange
Romanian Commodities Exchange
Shanghai Cereals and Oils Exchange
Nagoya Textile Exchange
Beijing Commodity Exchange
Osaka Securities Exchange
Sibiu Monetary-Financial and
Commodities Exchange
Tradepoint Investment Exchange
Developed Markets
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Europe - London
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Has some of the most developed and widely used
Futures and Options Markets
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Eurex
Euronext.liffe
OMX
Consolidation
Electronic trading system
Developed Markets (cont.)
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Euronext.liffe
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Euronext established in 2000
LIFFE (London International Financial Futures Exchange)
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LIFFE Connect
Euronext.liffe is creating a single market for
derivatives, by bringing all its derivatives
products together on a single electronic
trading platform
Future
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Consolidate
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Acquire London Stock Exchange
Developing Market
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China
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1500 to 1978 country faced war, poverty, corruption
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Prohibited foreign investment
1978 opened economy to outsiders
1990 Futures Market established
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Corrupt
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Many Markets closed
1992 CSRC (China’s Securities Regulatory Commission)
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Similar to the SEC (Securities and Exchange Commission)
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Plagued with insider trading, scandals, fraud, etc
Enforce regulations
Future Opportunities
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One of the world’s leading countries in natural resources,
population, and land
Futures market limited to domestic financial institutions
Options markets
Trading Floor Movement
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Electronic Platform
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Speed
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Fewer mistakes
Resilient to catastrophes
Sentimental value
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20-30% less
Robustness/Stability
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Traditional Open Outcry
milliseconds
Cost
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Excitement
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Shouts, hang signals, etc.
Source of Revenue
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150 year history in USA
Tourist Attraction
Employment
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Floor brokers, clerks,
assistants, etc.
Conclusion
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FLEX and Exotic Options
Developed and Developing Markets
Electronic vs Traditional Open Outcry
Trading Floor
Questions?