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AMEX MOVING AHEAD BY 'LEAPS AND BOUNDS;' EXCHANGE SEEKS SEC PERMISSION TO TRADE NEW HYBRID SECURITY CALLED BOUNDS

 AMEX MOVING AHEAD BY 'LEAPS AND BOUNDS;'


EXCHANGE SEEKS SEC PERMISSION TO TRADE NEW HYBRID SECURITY CALLED BOUNDS
 NEW YORK, July 16 /PRNewswire/ -- The American Stock Exchange today filed with the Securities and Exchange Commission (SEC) for approval to trade innovative derivative securities called BOUNDs(SM) -- Buy-write Option UNitary Derivatives.
 A BOUND is a long-term, option-like security that in a single instrument gives investors the equivalent of an option "buy write." A buy write is a combination position in which the owner of a stock sells a call option on it. A BOUND, like a buy write, will offer investors the opportunity to increase the return on the underlying stock as well as to reduce the risk associated with the stock ownership.
 BOUNDs are designed to complement the Exchange's LEAPS, options which currently trade on selected stocks with expirations of up to three years. BOUNDs and LEAPS(TM) together will provide characteristics similar to PRIMEs and SCOREs, respectively, which have traded on the Exchange since 1986. All of the original 26 PRIMEs and SCOREs will have reached their five-year termination dates by this August and will cease trading.
 "We have created BOUNDs to respond to the many investors who have been using PRIMEs and SCOREs. Together with LEAPS, our new BOUNDs will essentially give these investors similar investment opportunities," said Amex Chairman James R. Jones. "By using LEAPS and BOUNDs, investors will continue to have the ability to separate and trade the income and growth components of a stock."
 BOUNDs, like PRIMEs, will allow investors to participate in a stock's potential price appreciation up to the limit of the BOUND's strike price and to receive the equivalent of dividends paid on the stock. LEAPS, like SCOREs, enable investors to participate in a stock's potential price appreciation above the LEAP'S strike price.
 As a complement to each other, BOUNDs will be listed on stocks underlying Amex-traded LEAPS and will have the same strike prices and expiration dates. The Amex additionally has filed for SEC approval to list both LEAPS and BOUNDs with expirations of up to five years.
 BOUNDs will be cleared through The Options Clearing Corporation which will also serve as issuer and guarantor.
 The Amex trades a total of 282 stock options, including 77 options on over-the-counter stocks, as well as 33 LEAPS (Long-term Equity AnticiPation Securities). In addition, options are traded on five broad-market indexes-- the Major Market Index (XMI), the XMI LEAPS (TM) Index (XLT), the S&P MidCap 400 Index (MID), the Institutional Index (XII), and the Japan Index (JPN)-- as well as three industry based indexes-- the Oil Index (XOI), the Computer Technology Index (XCI) and the Pharmaceutical Index (DRG). CAPS-- Capped Options-- are also traded on XII.
 -0- 7/16/92
 /CONTACT: Shelly E. Wolfe of American Stock Exchange, 212-306-1641/ CO: American Stock Exchange ST: New York IN: FIN SU:


SH -- NY087 -- 9850 07/16/92 14:33 EDT
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Publication:PR Newswire
Date:Jul 16, 1992
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