International Securities Exchange Reports Options Volume For 2009

The International Securities Exchange (ISE) today reported average daily volume of 3.8 million contracts for the full year 2009, a decrease of 4.3% compared to the record year 2008. Total options volume for 2009 decreased 4.7% to 960.2 million contracts from 1.0 billion contracts in 2008. 

In December 2009, average daily trading volume for all options contracts was 2.7 million contracts, an increase of 2.1% compared to December 2008. Total options volume for the month increased 2.1% to 59.8 million contracts from 58.6 million contracts in the same year-ago period.

Equity and ETF Options Volume Statistics  

Index Options Volume Statistics

ISE FX Options® Volume Statistics

ISE's market share statistics continue to be negatively impacted by trading strategies that are permitted based on a non-economic rationale. These strategies include dividend trades and synthetic short interest trades. These trades temporarily inflate and distort trading volume and market share when transacted. As the following data demonstrates, high volatility in 2008 limited these objectionable strategies. With volatility low in 2009, dividend trades represented a significant portion of the growth in industry volume. If dividend trades were excluded from industry data, average daily volume in equity options would have decreased 0.1% in 2009 over 2008, compared to 2.9% growth when dividend trades are included.

If the volume from dividend trades were excluded from ISE's data for the full year 2009, our market share in equity options would increase to 29.2% from 28.1%, an increase of 1.1 market share points. If volume from dividend trades were excluded from ISE's data in 2008, our market share in equity options would increase to 30.4% from 30.1%.  

If the volume from dividend trades were excluded from ISE's data for December 2009, our market share in equity options would increase to 24.5% from 21.5%, an increase of 3.0 market share points. If volume from dividend trades were excluded from ISE's data in December 2008, our market share in equity options would increase to 28.7% from 28.3%. Exclusion of dividend trades from total industry volume data presents a more relevant measure of the relative trends in our business.

2009 Highlights 

• ISE was the largest U.S. equity options exchange in 2009. 
• On March 11, 2009, Quadriserv Inc. announced that ISE led a $34 million Preferred Stock investment round to support its all-electronic AQS™ securities lending platform.  
• On March 25, 2009, ISE published a proposal outlining its recommendations for reforming the regulation of U.S. financial markets. As one of only seven U.S. securities exchange operators, ISE brought a unique perspective to the public debates, setting forth recommendations that specifically focused on the oversight of market operations and trading venues.  
• On May 1, 2009, ISE eliminated customer transaction fees for Premium Products, which included multiply-listed exchange-traded fund (ETF) and index options.  
• On June 8, 2009, ISE introduced real-time options analytics in its front-end options trading system, PrecISE Trade®. "Greeks," a collection of variables that provide pricing information by quantifying different risk components of an option, are available to all PrecISE users in all options series traded on ISE.   
• On June 9, 2009, Ballista Holdings announced that it received a minority investment from leading securities industry firms ISE, Knight Capital Group, Morgan Stanley, Susquehanna Growth Equity, LLLP, and existing investors, including Metropolitan Equity Partners. Ballista Holdings is the owner of Ballista Securities LLC, operator of the Ballista Alternative Trading System for block trading of options, delta-neutral strategies and other complex options transactions.   
• On June 24, 2009, ISE announced that it signed an agreement with Equinix to serve as the primary data center for its new trading system, scheduled to begin its rollout in late 2010. Equinix will provide a Tier 3+, state-of-the art facility that is highly reliable and will accommodate future growth requirements of the exchange.  
• On June 24, 2009, ISE and Direct Edge announced that they jointly selected Telx to provide disaster recovery data center services as part of a comprehensive new data center strategy program.  
• On August 3, 2009, ISE launched options trading on the New Zealand dollar (Symbol: NZD), Mexican peso (Symbol: PZO) and Swedish krona (Symbol: SKA). 
• On August 4, 2009, ISE and Weather Risk Solutions, LLC (WRS), the developer of Hurricane Risk Landfall Options (HuRLO™), announced that they entered into a strategic agreement. ISE received a minority interest in WRS in return for granting WRS the right to use ISE's proprietary Longitude intellectual property. 
• On September 22, 2009, ISE launched dual currency conventions for four currency pairs in its portfolio of ISE FX Options. The "in US$" currency convention, typically used in the FX spot market, is available alongside ISE's USD-based currency convention for options on the Australian dollar, British pound, Euro and New Zealand dollar.  
• On December 2, 2009, ISE announced the launch of the ISE Open/Close Intraday File, providing intraday access to ISE's extensive put/call trade data that was previously only available as an end of day file.  
• On December 8, 2009, Knight Capital Group, Inc. (Nasdaq: NITE) and ISE announced that Knight Equity Markets, L.P. will become a Competitive Market Maker (CMM) on ISE's options exchange, effective in the first quarter 2010. Knight purchased ten CMM trading rights from TD Options, LLC that cover every options class listed on the exchange. 
• On December 8, 2009, ISE announced plans to introduce enhancements to its ISE FX Options product suite in early 2010. First, ISE will expand its product offering to include options on the Brazilian real (USDBRL). In addition, ISE plans to introduce "penny strikes" for each expiration month, creating a deep in the money call option for all currency pairs. Both new products are pending regulatory approval. 
• As of December 31, 2009, the First Trust Advisors portfolio of ETFs based on ISE's proprietary indexes reached over $764 million in aggregate assets under management. ISE's "pure play" indexes serve as benchmarks for the ETFs that target high growth sectors including natural gas, global wind energy, the emerging markets of China and India, global engineering and construction services and the water industry. 
• ISE traded more volume than any other options exchange in 1,006 of 2,167 issues in its listings in December 2009.