CBOE Will Move Second S&P 500 Options Contract to Main Exchange

CBOE Holdings Inc. (CBOE) plans to move a Standard & Poor’s 500 Index contract introduced last year on its C2 venue to the Chicago Board Options Exchange, where it can be bought and sold electronically and on the trading floor.

The S&P 500 index contract, which settles based on end-of- day prices rather than levels at the start of the session, currently can be traded only electronically on C2, an exchange introduced in 2010. The main options on the S&P 500 trade primarily in open outcry on the floor of the CBOE. Those contracts settle based on price levels at the start of the trading session and are the largest options product by volume.

The shift is expected to increase access to SPXpm (SPXPM), as the newer product is called, and its liquidity, CBOE said in an announcement today. Weekly and quarterly products based on the evening-settled index options will also move to the CBOE.

“Moving SPXpm to CBOE’s hybrid trading environment opens up access to a very active SPX trading crowd on the floor of the CBOE,” William Brodsky, Chairman and CEO of CBOE Holdings, said in the release. “Customers who prefer to trade SPXpm electronically may continue to do so, but will have the added benefit of tapping into the additional liquidity we expect to see from our trading floor.”

CBOE plans to move the products to its main exchange in the first quarter of next year, pending regulatory approval.

To contact the reporter on this story: Nina Mehta in New York at nmehta24@bloomberg.net.

To contact the editor responsible for this story: Lynn Thomasson in New York at lthomasson@bloomberg.net.