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Pacific Exchange Seeks to End Exclusive Options

September 09, 2003|From Bloomberg News

The Pacific Exchange, the smallest U.S. options market, has asked the Securities and Exchange Commission to end exclusive trading of options based on stock indexes and called for a moratorium on the introduction of any new contracts.

The San Francisco-based exchange made the requests in a Sept. 2 letter, released Monday as part of an e-mailed statement. On Thursday, the Philadelphia Stock Exchange said it obtained an exclusive license to offer options on Nasdaq.

"Exclusive listings are a tremendous disservice to public investors. They are anti-competitive" and increase costs for traders, Pacific Exchange Chief Executive Philip DeFeo said in the statement.

Options are the right to buy or sell assets at a set price and date. Index options, which typically settle in cash, generate more revenue than regular contracts.

"The Pacific Exchange is having trouble competing in the marketplace, so they are looking to the government to help bail them out," said Philadelphia Stock Exchange spokeswoman Barbara Sorid.

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