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Pacific Exchange Gets OK for Electronic System

May 15, 2003|From Bloomberg News

The Pacific Exchange, the smallest U.S. options exchange, said it received approval from the Securities and Exchange Commission for an electronic trading system designed to make transactions easier and cheaper.

The system will enable market makers -- companies that stand ready to buy when investors want to sell, and vice versa -- to place bids and offers without needing to be on the exchange's San Francisco trading floor. That will help the exchange attract more market makers and electronic traders, the exchange said.

The Pacific Exchange aims to regain market share from the all-electronic International Securities Exchange, which became the second-biggest U.S. options market this year. Options are the right to buy or sell an asset at a set price by a certain date.

The Pacific Exchange's system will start in October. The Pacific Exchange traded 6.46 million option contracts last month, compared with 19.3 million at the ISE.

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