The London International Financial Futures and Options Exchange is to partner with US electronic stock exchange Nasdaq to develop a global market for trading in single stock futures. The new products will be listed on the Liffe Connect electronic trading platform.
The move anticipates forthcoming regulatory changes which will for the first time enable US investors to trade single stock futures.
Under the terms of the agreement, Liffe and Nasdaq will form a US-regulated entity to provide single stock futures in the US and Europe on a wholly electronic platform. The partners say they will develop links with US and European clearing organisations.
Brian Williamson, Liffe's chairman comments: "The strength of Nasdaq's brand and its pre-eminent position in the US equity market will make our single stock futures offering a compelling choice for both retail and institutional customers in the US, as well as in Europe and beyond."
Liffe listed 25 stock futures in January this year, including five on US-based stocks. The products have had an average daily trading volume of 5000 contracts, the equivalent of 1.6 million underlying shares. The Exchange listed a further five contracts at the beginning of last week and will list 10 more in early April.
US regulators are expected to repeal the Shad Johnson Accord prohibiting trading in stock futures by 21 December.
Frank Zarb, Nasdaq chairman says: "We expect these instruments to become important investment vehicles in the United States and Europe."
He says the partnership with Liffe "gets us to market faster and positions us well to offer state-of-the-art electronic trading to investors in both the US and Europe".
Zarb says the Liffe Connect platform - currently available from over 380 sites in 23 countries across all three major time zones - provides an unrivalled distribution network for the new venture.