April 25, 2007

Options Trading On The FTSE




The FTSE is a worldwide and independent firm run by the London Stock Exchange and The Financial Times and is tasked to manage and create financial indices.

Professionals turn to the FTSE everyday for the tools and information they need to develop strategies that would help boost their investment portfolios to the greatest level possible.

Such professionals include, fund managers, investment banks, consultants, brokers, stock exchanges and the like. It maintains partnerships with companies and stock exchanges all over the world, in a bid to create a uniform way of handling international investment.

And because the FTSE hosts a plethora of global, regional, fixed income, alternative investment, non-market and governance indices, it is but inevitable that options are part of its roster of instruments traded.

The FTSE implements a tight set of policies and procedures on transparency and governance to make sure that all its indices are investment-worthy and easy to monitor.

Among its requirements are that all stocks should adhere to liquidity screens and must be free float adjusted and that all indices should have a set of guidelines that are easily accessible by the public.

Options trading on the FTSE does not deviate from the basic concepts of options trading itself. That is, prices at still set at predetermined price and exercised at a predetermined time frame.

What the FTSE offers differently is the venue, but options trading can generally occur in just about any other trading floor in the world.

The FTSE's roster of global indices include the FTSE All-World Index Series, the FTSE Global Style Index Series, The FTSE Emerging Markets, The FTSE Multinationals Index Series, The FTSE Global Sector Index Series and the FTSE Gold Mines Index Series, among others.

Its list of regional partners include the FTSE UK Index Series, the FTSE/ASEAN Index Series, the FTSE Hong Kong MPF Index, and the FTSE NASDAQ Index Series.

As you may well notice, the FTSE makes majority of its business in the UK. This is because it is owned by European companies. Hence, the options trading activities that occur in the FTSE are mostly European in nature.

At present the FTSE services clients and indices in more than 77 countries. What began as a small operation in 1995 now holds 11 offices all over the world, and even in key business areas in the the US, Africa, Europe and the Asia-Pacific.

More on this topic (What's this?)
FTSE, EDHEC Collaborate On Index Launch
Options Trading - Fun
The Basics of Options Trading
Read more on FTSE 100 Index (FTSE), Options Trading at Wikinvest

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