The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.

Liquidity holds the key in the race for SSF supremacy

Equity derivatives

The imminent introduction of single stock futures (SSFs) in the US is set to shake up the world of equity derivatives, but the emergence of five exchanges preparing to launch the product will make things interesting as they vie to become the market leader. Futures contracts on individual stocks were pioneered in Sweden by the OM Group in the 1980s and have been available on 14 other exchanges around the world for some time. The product has, however, largely failed to take off.

In the US, development was prohibited by law, as the Securities&Exchange Commission and Commodity Futures Trading Commission argued over which body should be responsible for the product's regulation. Now that the two regulators are amending their laws to allow trading in SSFs to begin under joint regulation, investors, traders and exchanges are just waiting for the final details regarding margins in order to begin.

Jerome Kemp, European managing director of futures and options at JPMorgan, does not consider the disappointing history of SSFs in Europe to be relevant to the product's chances in the US. He notes that the exclusion of US-based investors from the markets in SSFs has been a major factor in the product's disappointing performance.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree