STANDARD & POOR'S MIDCAP 400 INDEX TO ARRIVE ON THE AMEX AND CME ON FEB. 13
STANDARD & POOR'S MIDCAP 400 INDEX TO ARRIVE
ON THE AMEX AND CME ON FEB. 13
NEW YORK, Jan. 28 /PRNewswire/ -- Responding to the growing interest by the investment community in middle capitalization growth companies, the American Stock Exchange (Amex) and the Chicago Mercantile Exchange (CME) today announced a Feb. 13 joint launch date for derivative products based on the new S&P MidCap 400 Index. The Amex will trade stock options and the CME will trade futures and options on futures on the Index. Both exchanges were granted an exclusive license to trade derivative instruments on the S&P MidCap in September of 1991.
The announcement follows Securities and Exchange Commission approval for the Amex's MidCap Index options. Approval for the CME to list the futures and futures options is expected from the Commodity Futures Trading Commission (CFTC) by Feb. 11.
Introduced by S&P last year, the MidCap Index is composed of 400 companies with a median market capitalization of about $754 million and total market value of about $425 billion. To date institutional investors have indexed more than $2 billion in assets to the Index.
"Our customers from the global investment community have been eagerly awaiting the arrival of index options on the MidCap Index. This new investment vehicle will allow investors to take part in the dynamic and growing sector of mid-market companies," said American Stock Exchange Chairman James R. Jones.
The Amex's MidCap options will provide institutional and retail investors with the opportunity to take a position in the broad mid-range market and to potentially benefit from price movements in the Index.
"Investors will be able to use the CME products to enhance or protect their portfolio's return without buying or selling individual shares of stock," said Jack Sandner, chairman of the CME. "The addition of the S&P MidCap 400 to our S&P 500 and Nikkei 225 Index solidifies the CME's position as the index product trading center of the world. We will be introducing additional vehicles for investment and risk management to our lineup of index products in the near future."
The CME's futures contracts will be a primary risk management vehicle for institutional investors whose stock portfolios replicate the performance of the MidCap 400.
CME President and CEO William J. Brodsky, who was an executive vice president in charge of options trading at the Amex prior to joining the CME in 1982 said, "I am personally delighted to see the Merc and the Amex introducing these innovative new products, It is also significant that the S&P MidCap 400 derivatives will offer cross margining capabilities for proprietary account and market makers at the two exchanges on day one, joining our other index products."
Stock index options have been trading on the Amex since 1983. Broad-market and industry index options currently trading are the Major Market Index, XMI LEAPS (TM), the Institutional Index, the Computer Technology Index, the Japan Index and the Oil Index. In addition, the Amex is a premier marketplace for the trading of equity derivative products. Those products include put and call warrants on the Nikkei Stock Average, put warrants on the Financial Times-Stock Exchange 100 Share Index, and put warrants on the French CAroad segments of the Japanese, British and French stock markets.
The CME, the world's leading financial futures exchange, has traded the S&P 500 stock index futures contracts since 1982. With an average of nearly 50,000 contracts traded per day, the S&P 500 futures contract is the most liquid of its kind in the United States and has a product share of more than 85 per cent. The CME also trades futures on the Nikkei Stock Average.
/CONTACT: Shelly Wolfe of AMEX, 212-306-1641, or Joseph Whelan of CME, 312-930-8537/ CO: American Stock Exchange ST: New York IN: FIN SU: PDT SM -- NY039 -- 4168 01/28/92 11:10 EST