The Order Machine Processes 10 Millionth Options ContractNandini Sukumar
The Order Machine, a Dutch trading venue for options, said it processed its 10 millionth contract today as it takes business from NYSE Euronext’s Liffe derivatives market.
“We’ve seen a lot of newcomers to the market,” Willem Meijer, chief executive officer of TOM, said in a telephone interview today. “We will continue to grow. In 2014 we will aim for more than 50 percent market share in index options.”
TOM’s volume is driven mostly by clients using its so-called smart order router, which compares different prices on exchanges and executes against the best available, Meijer said. BinckBank NV, a shareholder in Amsterdam-based TOM, is the only broker using the router. Another broker will join by year-end, he said. In addition, Timber Hill Europe AG will become a market maker for TOM, Meijer said.
TOM, which is 25 percent owned by Nasdaq OMX Group Inc., said it will increase market share in options of the Netherlands’s benchmark AEX Index to 50 percent next year from 35 percent currently. TOM changed its ticker symbols for options based on the AEX last month after a court ruled it infringed NYSE Euronext’s trademark rights.
More than 875,000 Euro Stoxx 50 Index options traded every day on average this year, data compiled by Bloomberg show. That’s 21 percent below last year’s average. In the U.S., almost 17 million contracts have changed hands daily on average in 2013, 5.1 percent more than in 2012, according to the Chicago-based Options Clearing Corp.
Trading of Standard & Poor’s 500 Index options reached a daily average of almost 830,000 this year, the most ever and 18 percent more than in 2012, data compiled by Bloomberg going back to 2000 show.
NYSE Euronext owns Liffe, bourses in Amsterdam, Brussels, Paris and Lisbon, and the New York Stock Exchange. The company has agreed to be bought by Intercontinental Exchange Inc.