Kansas City Board Of Trade Seeks To Simplify Value Line Stock Index Contract

The board of directors of the Kansas City Board of Trade has approved plans to simplify its offerings on the Value Line stock index, trading one futures contract on the product rather than two. Pending approval by the Commodity Futures Trading Commission, the KCBT will eliminate its Value Line stock index futures contract with a value of $250 times the futures price. It will drop the word "Mini" from the name of its Mini Value Line futures and options contract with a value of $100 times the futures price. This will leave the exchange trading one futures and options contract called the Value Line, with the same $100 multiplier that has previously been referred to as the "Mini." A sustained rally in the U.S. stock market has greatly increased the value of stock index contracts, making the larger contract with the $250 multiplier less attractive as a trading vehicle. Meanwhile, the contract with the $100 multiplier continues to be used as an effective investment tool. "This change will simplify the exchange's offerings in the Value Line, while maintaining the product that customers have gravitated toward," said Michael Braude, KCBT President. "Smaller-sized stock index contracts truly are the wave of the future." Pending a filing by the exchange and CFTC approval, the changes will go into effect on March 20, 2000, the first business day following the March 2000 futures contract expiration. The Kansas City Board of Trade pioneered trade in stock index futures with its launch of the Value Line in 1982, and once again led the marketplace with smaller stock index futures by introducing the Mini Value Line in 1983. Value Line futures are based on the Value Line Arithmetic Index, a broad-based, equal-weighted market measure of 1,650 blue-chip, mid-size and small-cap issues. Value Line is a registered trademark of Value Line, Inc.