ISE Launching Second Options Exchange
March 4, 2013
International Securities Exchange Holdings plans to start a second options market, to be called Topaz Exchange, according to filings with the Securities and Exchange Commission. If approved it will be the twelfth U.S. exchange for equity derivatives.
The operator of the third-largest individual exchange for U.S. options will own the Topaz venue, according to a filing with the SEC published on March 1.
Gary Katz, president and chief executive officer of the International Securities Exchange, said it would start a second market to compete with rivals CBOE Holdings Inc., Nasdaq OMX Group Inc. and NYSE Euronext a year ago, according to Bloomberg News, which first reported the base filing.
The ISE, a subsidiary of German derivatives exchange Eurex and its parent, the Deutsche Boerse Group, launched the first all-electronic options exchange in the United States, in 2006. That exchange offers options trading on more than 2,000 underlying equity, exchange-traded fund, index, and foreign exchange products.
ISE offers equity and index options, including proprietary index products, as well as FX options based on foreign currency pairs. ISE also offers market data tools designed for sophisticated investors seeking information on investor sentiment, volatility, and other options data.
ISE Stock Exchange launched in September 2006. In August 2008, ISE Stock Exchange announced a partnership with the electronic communication network Direct Edge. The deal makes the ISE Stock Exchange a wholly owned subsidiary of Direct Edge and will give ISE an ownership stake in Direct Edge.
“There are synergies that we can offer to firms by operating multiple exchanges on the same technology platform,’’ according to ISE spokesperson Farhan Husain. “Members will be able to leverage existing connectivity and benefit from the functionality of our trading technology across multiple market models.’’