Free Site Registration

SEC Moves on Stock Futures

Traders Magazine, May 2002

Staff Reports

Stock future sales must now include in the final settlement price of cash-settled security products the opening price of the underlying security, according to new rules just adopted. The Securities and Exchange Commission also required an immediate halt in trading of single stock futures when trading in the underlying security stops. The new SEC orders also apply to narrow-based index products. Trading in the security will be halted when a halt occurs on one or more of the underlying securities, representing 50 percent or more of the market capitalization of the index future, according to SEC officials. They said that this method will allow participants to maintain proper hedge positions while preventing circumvention in halts of the underlying securities.

Get access to this article and thousands more...

All TradersMagazine.com articles are archived after 7 days. REGISTER NOW for unlimited access to all recently archived articles, as well as thousands of searchable stories. Registered Members also gain access to exclusive industry white paper downloads, web seminars, online technology directory, the iPad App, and conference discounts. Qualified members may also choose to receive our free monthly magazine and any of our e-newsletters covering the latest breaking news, opinions from industry leaders, developing trends and trading strategies.

Already Registered?

Advertisement

Advertisement