Nasdaq Plans To Start Trading Options
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Nasdaq Stock Market Inc., the largest all-electronic stock exchange in America, plans to expand into options trading, entering a market that’s growing more than twice as fast as equities.
Nasdaq will trade contracts on equity and index options by the third quarter of next year, pending approval by the U.S. Securities and Exchange Commission, it said in a statement today.
The New York-based company would become the seventh American options market, challenging the Chicago Board Options Exchange, which ranks No. 1, and the Philadelphia Stock Exchange. NYSE Group Inc., the world’s biggest stock exchange, also trades options.
An industry shift, requested by the SEC, to trading options in penny increments from dimes and nickels will spur more transactions by hedge funds and retail investors, opening the way for new competitors, Nasdaq said.