ISE hits out at CBOE on exclusive index option listings

The New York-based International Securities Exchange (ISE) is challenging the exclusive listing of two major index options on the Chicago Board Options Exchange (CBOE) through a formal complaint.

The ISE unveiled it has filed the complaint, which aims to end the CBOE’s exclusive listing of index options on the Dow Jones Industrial Average and the S&P 500 Index. It seeks a declaratory judgement from New York’s Southern District Court, affirming the ISE does not need a licence to list the options.

The CBOE currently has licensing agreements to list options on the indexes with Dow Jones and Company and the McGraw-Hill Companies. A declaratory judgement is binding, and would tell the two New York-based companies whether or not they could prevent the ISE from listing the options. However, it would not award damages or order them to take any further action.

In June, the US Court of Appeals dismissed complaints from both companies, which challenged the ISE’s listing of options on SPDR (Standard and Poor’s depository receipts) and Diamonds exchange-traded funds.

David Krell, the ISE’s chief executive, said: “As a result of the ISE’s leadership, the market has experienced increased liquidity, tighter spreads, and lower customer transaction fees, and we want to deliver those same benefits to investors in the remaining exclusively listed index options.”

(See also: Dow Jones granted temporary restraining order against ISE)