It has been a year since the New York Stock Exchange (NYSE) appointed Meaghan Dugan as Head of Options. “It has been an honor to serve as Head of Options at the NYSE during an impactful period for us and the industry,” she told Traders Magazine.
Just in the last year, the options market has experienced strong growth, and the NYSE’s “best-in-class” technology has been able to process this growth in volume with ease, she said.
For the last two years, NYSE Arca Options has been the leading exchange by volume on a quarterly basis, said Dugan, adding that the NYSE is well positioned to continue capitalizing on this growth as they further advance their technology.
Dugan said that she took on the role of Head of Options at a “pivotal time” for the exchange.
The NYSE was just starting to transfer the first of their two options exchanges, NYSE Arca Options, to NYSE Pillar, which is a highly deterministic, resilient trading platform that provides a single code base to simplify their members’ connectivity to the NYSE.
With NYSE Pillar, NYSE Arca Options now has a much more systematic connection, from new-order creation by the floor broker and to the trading officials for review and approval, Dugan said.
“Our enhanced technology has improved workflows and quickened the open outcry process on NYSE Arca Options, similar to the improvement NYSE Pillar has brought across our five equities exchanges,” she said.
Dugan recalled that on her first day in this role, she found herself navigating a complete technology overhaul: “It was incredible to be right in the thick of it.”
“Teams across the business came together and provided a seamless launch coordinated closely with our members,” she added.
In October, the NYSE plans to migrate its second and final options exchange, NYSE American (“Amex”) Options, to NYSE Pillar, according to Dugan.
“This will be another incredible milestone for both me and our options business. My team and I are hard at work preparing for the planned October migration,” she said.
“Our certification environment is open, and our members are in the testing phase. I place a heavy emphasis on our members throughout the migration process, as it’s important that they are aware of and understand the improvements we are making,” she added.
To accomplish this, the NYSE hosts monthly webinars, which provide the ability to get in front of many groups of their members that are working together to certify, connect and prepare for their Pillar launch, according to Dugan.
Options Market Trends
Dugan said she has witnessed three key trends in the options market. First, there has been continued concentration into short-dated contracts (or zero-dated options), which has proliferated within the top 50 symbols, she said, adding that over the last year, they have seen underlying symbol concentration in the top 50 symbols increase from 50% of overall volume to now 70% of overall volume.
Second, according to Dugan, as open outcry trading continues to be a large driver of technological advancements and market interest, the NYSE has been developing new technology to deliver tools for their floor brokers that accelerate and systemize manual processes on NYSE Arca Options and NYSE Amex Options.
By partnering with TRAFiX, the floor broker OMS provider, the NYSE provided new features and tools, such as a cash spread calculator, which helps automate and systematize the workflows for their floor members, she said.
“This will help incrementally quicken open outcry workflows for the benefit of the industry and its participants,” she said.
Finally, according to Dugan, across the options industry there have been re-platforming and upgrades on exchanges’ technology systems. “When I became Head of Options, the NYSE Amex Options Pillar migration was scheduled for the fall of 2023, and I’m happy to share that we are on track and have been heavily engaged with our customers throughout the last year,” she commented.
Women in Finance & DEI at the NYSE
In her early career, Dugan was keenly aware that she was one of few women working on the trading floor at the Pacific Exchange, now known as NYSE Arca Options.
She said she has always been curious in nature, and that curiosity was not defined by her gender.
“I was eager to learn more about the business, and with hard work I was able to move forward since options trading is based on merit,” she stressed.
Dugan told Traders Magazine that throughout her career, she has volunteered to take on more work, which also helped her progress. “Last year, I raised my hand for the Head of Options role and recently did the same for an OCC Board opening,” she said.
“I’m incredibly grateful to be surrounded by talented female leaders at the NYSE including NYSE President Lynn Martin, who fosters an inclusive culture. I advise everyone — women especially — to be vocal about what you want in your career and say “yes” to new opportunities,” she added.
Dugan said that at the NYSE, they care greatly about promoting DEI both within their own organization and their listed company community.
For example, the NYSE leverages their building and brand to provide a platform for DEI events hosted by the NYSE and their listed companies and clients, she said.
Additionally, as part of their suite of sustainability tools, the NYSE launched the NYSE Board Advisory Council in 2019 to create a pool of diverse board-ready candidates for their listed companies seeking directors, Dugan said.
To celebrate outstanding achievements by Women in Financial Services, Markets Media will be hosting the ninth annual 2023 U.S. Women in Finance Awards, which will be held on Thursday, November 16, at the Hard Rock Hotel in New York City.
