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Tehran Stock Exchange (TSE), the Iranian securities market operator, began trading of single stock futures, as a new investment instrument, with two listed most-actively traded companies on 25 July 2010.
Dr. Hassan Ghalibaf Asl, CEO of TSE, commented during the opening ceremony "we are very pleased to develop a broader international investor base focused on the futures market. Moreover, offering the new product will help us broaden and deepen our market."
"We are committed to offering our members and investors a diversified product. At the first Step, we offer eight futures contracts based on two listed banks, Parsian Bank and Karafarin Bank and will expand it to at least 10 stocks by March 2011.
The two stocks have been selected due to their substantial underlying liquidity and several tests." he added.
The futures contracts will be denominated in Iranian Rial and settled physically. Their maturity dates will be of two-month cycles.
By listing futures contracts, TSE will be able to develop a service which meets the needs of an even wider range of investors, as well as provide them with increased diversification and hedging opportunities. The product allows investors to bet on stocks with less money than buying the same outright. This is an instrument that helps TSE's participants to manage the risks more efficiently.
All transactions will be cleared and settled by CSD Iran, the Iranian clearing house.
The launch of Single Stock Futures Market has been accomplished following the recent introduction of the new Futures Trading System (SAMA), designed specifically for the Futures Market of Iran by the IT department of Tehran Stock Exchange with cooperation of Iran Mercantile Exchange.
The market's opening ceremony was attended by Mr. Huseyin Erkan, Istanbul Stock Exchange's president, and Mr. Ali Saleh-abaady, the president of Securities and Exchange Organization of Iran, as well as some other authorities of the Iranian capital market at the TSE's trading floor.
