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Gwenn
Daniel Goncharoff wrote:
> Can anyone explain why you would even consider single stock futures instead of
> just loosening margin requirements and eliminating the uptick rule? Plus consider
> the administrative burden introduced to monitor insider trading, front running,
> etc. in both the futures and the stocks at the same time (of course, we have that
> same burden for options now, so it IS managable).
>
> Regards
> DanG
>
> I4Lothian@xxxxxxx wrote:
>
> > We already have single stock futures here, they are called synthetic futures
> > by buying a put and selling a call at the same strike on the options on a
> > stock, or visa versa.
> >
> > Thus, you can effectively use futures-like equivalent to hedge or trade
> > stock, but it is costly and cumbersome. The time is now to change the laws
> > and open the U.S. markets to innovation before some offshore non-U.S.
> > exchange creates the market and attracts the volume.
> >
> > I believe single stock futures would attract additional volume to stocks and
> > create additional arbitrage opportunities which will only help liquidity in
> > the underlying stocks. Combine that with a central time price order book for
> > stocks and I think you have some efficient markets and an up to date
> > regulatory structure in the making.
> >
> > Regards,
> >
> > John J. Lothian
> >
> > Disclosure: Futures trading involves financial risk, lots of it!
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