Commentary

Jared Dillian
Traders Magazine Online News

Was it Worth It?

In this piece from 10th Man, author Jared Dillian discusses how the ETF revolution is less about ETFs and more about indexing; about how people have come to view stocks less as stocks and more as blobs of stocks.

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May 31, 2002

SEC Moves on Stock Futures

By 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.

The SEC is expected to review the final security futures rules soon, staff members said. The staff is also working on four or five remaining items, with margin requirements probably the biggest item on the agenda.