ISE Files Court Action Seeking to End Exclusive Listing of DJIA and S&P 500 Index Options
November 02 2006 - 3:05PM
Business Wire
The International Securities Exchange (NYSE:ISE) today announced
that it has filed a complaint in the United States District Court
for the Southern District of New York seeking to end the exclusive
listing of certain index options. ISE has asked the District Court
to issue a declaratory judgment holding that ISE does not need a
license to list index options on the Dow Jones Industrial Average
(Ticker: DJX) and S&P 500 Index (Ticker: SPX). Currently, these
two actively-traded index options trade exclusively on the Chicago
Board Options Exchange (CBOE) pursuant to licensing agreements
between CBOE and Dow Jones & Company, the provider of the Dow
Jones Industrial Average, and The McGraw-Hill Companies, Inc., the
provider of the S&P 500 Index. In June 2006, the United States
Court of Appeals for the Second Circuit ruled that ISE did not need
a license to list options on the SPDR and DIAMONDS ETFs. �ISE was
founded on the belief that competition among exchanges improves
market efficiency and, ultimately, benefits investors,� said David
Krell, ISE�s President and Chief Executive Officer. �We have
witnessed this occurrence for equity, ETF, and certain index
options since ISE announced its entry into the market eight years
ago, providing the spark that ended the practice of exclusively
listing options on only one exchange. As a result of ISE�s
leadership, the market has experienced increased liquidity, tighter
spreads, and lower customer transaction fees, and we want to
deliver those same benefits to investors in the remaining
exclusively-listed index options.� Since options have become
multiply listed, annual options volumes have nearly tripled from
507 million contracts traded on all exchanges in 1999 to over 1.5
billion contracts traded in 2005. Year-to-date options volumes are
up an additional 40.1% according to The Options Clearing
Corporation (OCC). Copies of ISE�s complaint are available from the
United States District Court for the Southern District of New York.
ISE is represented in the litigation by DLA Piper US LLP. ISE
Background International Securities Exchange Holdings, Inc. (NYSE:
ISE), through its subsidiaries, operates a family of innovative
securities markets. ISE is founded on the principle that technology
and competition create better, more efficient markets for investors
and consists of an options exchange, a stock exchange and an
alternative markets platform. ISE continually enhances its trading
systems and develops new products to provide investors with the
best marketplace and investment tools to trade smarter. ISE
developed a unique market structure for advanced screen-based
trading systems and in May 2000 launched the first fully-electronic
US options exchange. Currently, ISE is the largest U.S. equity
options exchange and is among the leading options exchanges in the
world. ISE offers index options, including a portfolio of
proprietary index products, and enhanced market data products for
sophisticated investors. ISE FX Options� are slated to launch in
the first quarter of 2007. ISE Stock Exchange, launched in
September 2006 with strategic partners, includes an innovative
MidPoint Match� platform which offers investors continuous price
improvement. It is expected that MidPoint Match will be integrated
with a fully-displayed Best Bid Offer market in the fourth quarter
of 2006. ISE�s alternative markets business currently consists of
an events market trading platform known as Longitude. Longitude�s
patented and proprietary technology provides a unique parimutuel
structure for derivatives auctions which results in greater trading
and pricing flexibility for market participants. For more
information about ISE and its options exchange, visit
www.iseoptions.com and for more information about ISE Stock
Exchange, visit www.isestock.com. Additionally, to learn more about
ISE alternative markets technology, visit www.longitude.com.
Forward Looking Statements Certain matters discussed in this press
release are �forward looking statements� intended to qualify for
the safe harbor from liability established by the Private
Securities Litigation Reform Act of 1995. These statements relate
to future events or our future financial performance, and involve
known and unknown risks, uncertainties and other factors that may
cause our actual results, levels of activity, performance or
achievements, to be materially different from those contemplated by
the forward looking statements. We undertake no ongoing obligation,
other than that imposed by law, to update these statements. Factors
that could affect our results, levels of activity, performance or
achievements and cause them to materially differ from those
contained in the forward looking statements can be found in our
filings with the Securities and Exchange Commission, including our
annual report on Form 10-K, current reports on Form 8-K and
quarterly reports on Form 10-Q, as amended. The International
Securities Exchange (NYSE:ISE) today announced that it has filed a
complaint in the United States District Court for the Southern
District of New York seeking to end the exclusive listing of
certain index options. ISE has asked the District Court to issue a
declaratory judgment holding that ISE does not need a license to
list index options on the Dow Jones Industrial Average (Ticker:
DJX) and S&P 500 Index (Ticker: SPX). Currently, these two
actively-traded index options trade exclusively on the Chicago
Board Options Exchange (CBOE) pursuant to licensing agreements
between CBOE and Dow Jones & Company, the provider of the Dow
Jones Industrial Average, and The McGraw-Hill Companies, Inc., the
provider of the S&P 500 Index. In June 2006, the United States
Court of Appeals for the Second Circuit ruled that ISE did not need
a license to list options on the SPDR and DIAMONDS ETFs. "ISE was
founded on the belief that competition among exchanges improves
market efficiency and, ultimately, benefits investors," said David
Krell, ISE's President and Chief Executive Officer. "We have
witnessed this occurrence for equity, ETF, and certain index
options since ISE announced its entry into the market eight years
ago, providing the spark that ended the practice of exclusively
listing options on only one exchange. As a result of ISE's
leadership, the market has experienced increased liquidity, tighter
spreads, and lower customer transaction fees, and we want to
deliver those same benefits to investors in the remaining
exclusively-listed index options." Since options have become
multiply listed, annual options volumes have nearly tripled from
507 million contracts traded on all exchanges in 1999 to over 1.5
billion contracts traded in 2005. Year-to-date options volumes are
up an additional 40.1% according to The Options Clearing
Corporation (OCC). Copies of ISE's complaint are available from the
United States District Court for the Southern District of New York.
ISE is represented in the litigation by DLA Piper US LLP. ISE
Background International Securities Exchange Holdings, Inc. (NYSE:
ISE), through its subsidiaries, operates a family of innovative
securities markets. ISE is founded on the principle that technology
and competition create better, more efficient markets for investors
and consists of an options exchange, a stock exchange and an
alternative markets platform. ISE continually enhances its trading
systems and develops new products to provide investors with the
best marketplace and investment tools to trade smarter. ISE
developed a unique market structure for advanced screen-based
trading systems and in May 2000 launched the first fully-electronic
US options exchange. Currently, ISE is the largest U.S. equity
options exchange and is among the leading options exchanges in the
world. ISE offers index options, including a portfolio of
proprietary index products, and enhanced market data products for
sophisticated investors. ISE FX Options(TM) are slated to launch in
the first quarter of 2007. ISE Stock Exchange, launched in
September 2006 with strategic partners, includes an innovative
MidPoint Match(TM) platform which offers investors continuous price
improvement. It is expected that MidPoint Match will be integrated
with a fully-displayed Best Bid Offer market in the fourth quarter
of 2006. ISE's alternative markets business currently consists of
an events market trading platform known as Longitude. Longitude's
patented and proprietary technology provides a unique parimutuel
structure for derivatives auctions which results in greater trading
and pricing flexibility for market participants. For more
information about ISE and its options exchange, visit
www.iseoptions.com and for more information about ISE Stock
Exchange, visit www.isestock.com. Additionally, to learn more about
ISE alternative markets technology, visit www.longitude.com.
Forward Looking Statements Certain matters discussed in this press
release are "forward looking statements" intended to qualify for
the safe harbor from liability established by the Private
Securities Litigation Reform Act of 1995. These statements relate
to future events or our future financial performance, and involve
known and unknown risks, uncertainties and other factors that may
cause our actual results, levels of activity, performance or
achievements, to be materially different from those contemplated by
the forward looking statements. We undertake no ongoing obligation,
other than that imposed by law, to update these statements. Factors
that could affect our results, levels of activity, performance or
achievements and cause them to materially differ from those
contained in the forward looking statements can be found in our
filings with the Securities and Exchange Commission, including our
annual report on Form 10-K, current reports on Form 8-K and
quarterly reports on Form 10-Q, as amended.
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