Extensions To LIFFE's Wholesale Trading Facilities

LIFFE's Wholesale Market Facilities, which include its Block Trading Facility and Basis Trading Facility, provide an important adjunct to its central markets by recognising the need to allow large and contingent trades to be conducted without execution risk. In response to customer demand, and to further enhance and facilitate the trading relationship between wholesale market activity, particularly in the OTC markets, and exchange traded contracts, LIFFE's Basis Trading Facility will be extended from bond and equity index futures against cash bonds and stocks respectively, to allow: Interest rate swaps, Forward Rate Agreements and cash bonds to form the cash leg of a basis trade involving any of LIFFE's Short Term Interest Rate futures; a wide range of asset allocation trades between defined combinations of the Exchange's own futures contracts; and OTC options and OTC options strategies to form the cash leg of a basis trade against related equity and financial futures contracts. Dan Casey, Managing Director Business and Market Development, said "The dynamics of our markets are evolving rapidly and these exciting and important developments will provide our customers with the tools they need to conduct their wholesale business in the most cost effective and execution risk-free way. The market has asked for these new facilities and we are providing them in the knowledge that they will support our growing central markets and add considerably to the 1.1 million lots traded through these facilities last year."