Stocks & Commodities V. 25:4 (98, 96): At The Close by Jeffrey P. Seyler
An Update On Single-Stock Futures
Now that single-stock futures (SSF) have been trading
for more than four years, we have had an opportunity to see how they have developed and observe some of the changes that have occurred as a part of a growing new market. Several notable changes have taken place since they began trading in November 2002. One of the two original exchanges, NQLX, is gone, leaving OneChicago as the only exchange offering these products. From the outset, OneChicago was the clear leader, so that should come as no surprise. The only advantage I saw that NQLX offered over OneChicago was a contract length out to 15 months, and frankly all of my single-stock trades have been of a much shorter duration.
Another big change is that the microsector indexes, which never were offered by NQLX, have been shelved for the time being by OneChicago. They have not been eliminated and, as explained to me by the nice folks there, will be brought back any time there appears to be a demand for them. In addition, the exchange is actually offering custom-designed indexes for specific institutional traders based on specific demand, but I will restrict this discussion to single-stock futures.