December 15, 2010

CFTC Mulls Options Trade On PPLT, PALL
The Commodity Futures Trading Commission is considering a request to allow trading in options of ETF Securities’ physical platinum and palladium exchange-traded funds.

If the CFTC approves the request, it would mark the first time options trading is allowed for platinum and palladium ETFs.

To begin trading options on its ETFS Physical Platinum Shares (NYSE Arca: PPLT) and the ETFS Physical Palladium Shares (NYSE Arca: PALL), ETF Securities and its clearing agent must first obtain “exemptive relief” under Rule 4(c) of the Commodity Exchange Act.

The request for exemptive relief was made by the Options Clearing Corporation, which acts as both the issuer and guarantor of options and futures contracts.

CBOE’s October Volume Falls
The Chicago Board Options Exchange saw its average daily volume fall 6 percent year-over-year in October, working out to 4.3 million contracts.

Interestingly, the October volumes for ETF and equity index options were higher than those of the equity options. While the ADV for equity options was down 12 percent, the ADV for equity index options was up 4 percent and the ADV for ETF options was down just 2 percent.

Among the index and ETF options contracts, the contracts on the S&P 500 Index, SPDR S&P 500 (NYSE Arca: SPY), CBOE Volatility Index (VIX), PowerShares QQQ Trust (Nasdaq GM: QQQQ) and SPDR Gold Trust (NYSE Arca: GLD) were the most actively traded.

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