The two Market Specialists will also lead in the launch of two new NYFE futures products based on Russell's U.S. equity indexes. According to the agreements, LaBranche will be the Market Specialist for the new NYSE Composite Index products and the Russell 1000® Growth Index products beginning May 9, 2003, for the futures contract and May 16, 2003, for the options, and Susquehanna will be the Market Specialist for products based on the Russell 1000® and Russell 1000® Value Index beginning May 9, 2003, for both the futures and options contracts.
"The NYFE markets have seen growth of more than 52% over the last year," said Charles H. Falk, Chairman of the New York Board of Trade. "Our new Market Specialist program will add to that growth and encourage those in the marketplace to take advantage of the unique investment opportunities offered by the NYFE markets. LaBranche Structured Products and Susquehanna Investment Group have both shown the vision and leadership needed to build a reliable, liquid marketplace at NYBOT for these important index contracts."
The Market Maker Agreement requires the exchange-approved Market Specialist to continuously maintain a competitive two-sided market consisting of a current bid and current offer no wider than the bid-ask spread specified by the exchange. The continuous presence of the Market Specialist provides reliable pricing and the necessary liquidity to support the business goals and trading strategies of institutional and individual investors.
In return, the Market Specialist will be entitled to a minimum percentage of open outcry trades.
LaBranche Structured Products states: "As a leading specialist firm, we are committed to being a part of new and important products as they come to the marketplace. We are committed to providing liquidity in order to assure the best possible market for participants. We are very pleased to be associated with the NYBOT and look forward to this new venture."
The designated Market Specialist must appoint and supervise two individuals to fill their Market Maker obligations on the trading floor. Additionally, the Market Specialist's representatives may only trade the firm's proprietary account and must be willing to trade a minimum number of contracts set by the exchange. The Market Specialist will file with the NYBOT Compliance Department a written description of its procedures to prevent the flow of information between the Market Specialist's representatives and the Market Specialist's employees and affiliates who are responsible for the execution of customer orders.
In April 2003, NYBOT announced an agreement with Frank Russell Company to allow NYBOT the right to begin trading a new suite of products based on 21 of Russell's U.S. equity indexes. The addition of a value and growth futures contract component for each of the highly regarded, objective Russell benchmarks for the U.S. equity market recognizes that the value/growth distinction has gained acceptance as a fundamental element of equity investment strategies, and that a focus on "style" has become one of the most dominant features of the investment landscape.
In January 2003, the New York Stock Exchange revised its flagship NYSE Composite Index with a new methodology that is fully transparent and rule based. In March 2003, NYBOT introduced new futures and options contracts based on the revised Index to provide opportunities for investors to trade the broad market with a single instrument.
Founded in 1924, LaBranche & Co. Inc. is a leading Specialist firm on the New York Stock Exchange (NYSE) and the American Stock Exchange (AMEX); its LaBranche Structured Products LLC is a wholly owned subsidiary of LaBranche & Co. Inc. and an affiliate of LaBranche & Co. LLC. LaBranche Structured Products was organized in September 2002 to act as a Specialist in options and a Market Maker in Exchange Traded Funds on the American Stock Exchange. LaBranche & Co. LLC is the Specialist for more than 650 companies, nine of which are in the Dow Jones Industrial Average, 30 of which are in the S&P 100 Index and 101 of which are in the S&P 500 Index. In addition, LaBranche Structured Products LLC acts as the Specialist in over 200 options and as a market maker in 90 Exchange Traded Funds (ETFs). For more information, please visit www.labranche.com.
Susquehanna Investment Group, a subsidiary of Susquehanna International Group, LLP (SIG), is a leading institutional sales and market making firm, and offers renowned execution expertise in listed, NASDAQ, Exchange Traded Funds (ETFs), options and American Depositary Receipts (ADRs). In addition, SIG encompasses a New York Stock Exchange specialist in over 150 listings, a NASDAQ market making operation in nearly 3,000 stocks, is the nation's largest option market maker and specialist in over 725 option classes, and is the leading sector index options trading firm. SIG is also one of the largest liquidity providers in ETFs. SIG is active in the markets of over 20 countries on 5 continents, including offices in Bala Cynwyd, Boston, Chicago, Dublin, New York, Philadelphia, San Francisco, and Sydney. For more information about SIG, please visit www.sig.com.
Frank Russell Company, a global leader in multi-manager investment services, provides investment products and services in more than 35 countries. Russell manages $67 billion in assets and advises clients worldwide representing $1.6 trillion. Founded in 1936, Russell is a subsidiary of Northwestern Mutual and is headquartered in Tacoma, Wash., with additional offices in New York, Toronto, London, Paris, Singapore, Sydney, Auckland and Tokyo. For more information, go to www.russell.com.
The NYBOT's New York Futures Exchange, Inc. (NYFE) index subsidiary provides futures and options markets based on several equity and commodity indexes. The NYFE began trading futures contracts based on the NYSE Composite Index in 1982 and options on the index in 1983. Since its founding, NYFE has introduced several other key index products including futures and options contracts based on the Reuters CRB Futures Price Index and the Russell 1000® Index.
The New York Board of Trade (NYBOT) is the parent company of the Coffee, Sugar and Cocoa Exchange, Inc. (CSCE) and the New York Cotton Exchange (NYCE). Through its two exchanges and their subsidiaries and divisions, NYBOT offers an expanding range of agricultural, currency and index products. Information about the New York Board of Trade can be found at www.nybot.com and www.nybotlive.com.
