"We are pleased to announce the latest installment in a spate of changes to the Value Line contract," said Vice President of Marketing Shelia A. Summers. "Recent changes include the reduction in the multiplier, the addition of a market maker, and of course, the move to all-electronic trading for the contract on the e-cbot platform. The Kansas City Board of Trade is dedicated to responding to customer’s needs with the Value Line Contract."
The Value Line trades on the Chicago Board of Trade’s (CBOT‚) e-cbot‚ electronic trading platform powered by LIFFE CONNECT‚. Futures trading hours are 7:15 p.m. to 3:15 p.m. CT Sunday through Friday until Sunday night, October 8, when all electronically traded contracts will start opening one hour earlier.
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. Currently, there is one Value Line contract, with a $25 multiplier. 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.
The Value Line remains one of the broadest-based stock indexes and is a good indicator of how the market will perform. The Value Line’s ability to reflect broad market performance comes from the equal weighting given each stock in the index. As a result, the price movement of a smaller company has as much impact on the index as the movement of a larger company. This is unlike other stock indexes, which are weighted by capitalization, where the movement of larger or higher-priced stocks has a disproportionate influence. Composed of about 1,650 stocks from different industries, the Value Line includes blue-chip, mid-cap and small-cap issues. About 70 percent are traded on the New York Stock Exchange, 29 percent are traded on the NASDAQ and the remainder are traded on the American Stock Exchange and Canada.
The Value Line is a great candidate for spread trading. It’s an excellent spread against more narrow indexes such as the Dow Jones Industrial Average and the Standard & Poor’s 500, and against broader capitalization-weighted indexes such as the Russell 2000.
Value Line® is a registered mark of Value Line® Inc., a New York corporation that provides financial services and publications. Since 1982, the Kansas City Board of Trade has been licensed to use the Value Line® mark in connection with its efforts to establish futures markets tied to the Value Line® index. The Kansas City Board of Trade and Value Line® Inc. are not affiliated corporate entities.
e-cbot®/CBOT/The CBOT Logo is a service mark of the Board of Trade of the City of Chicago, Inc. and is registered in the United States.
LIFFE CONNECT® is a trademark of LIFFE Administration and Management and is registered in Australia, Hong Kong, Singapore, the United States and the United Kingdom, is a registered Community Trade Mark, and is the subject of a pending application for registration in Japan.
