Options Market France
Encyclopedia
Options Market France is a futures exchange
and clearing house. In November 1987 Options Market France started publishing in association with the French bank CCF - now HSBC France - a stock index using the Reuters network under the symbol EFX 50. The index was computed from a basket of the 50 most liquid stocks traded on the Paris Stock Exchange, the Paris Bourse
. At the time the CAC 40
did not exist yet and the French stock exchange instead published at the end of each trading day a trend indicator of the French stock market computed using the closing value of the 240 largest stocks by market value. The EFX 50 was the first stock index in Paris with a streaming update based on the transaction prices of the underlying stocks.
In July 1988 it was granted authorization by the French Ministry of Finance to operate as a regulated Futures and Options Exchange. On July 21, 1988, OMF launched two contracts, a future contract on the EFX 50 and an option contract on the future. The contracts were traded electronically from workstations located in the dealing rooms of the exchange members. The contracts were cash settled. At its launch OMF exchange members included the large European, Japanese and American banks which also traded the notional bond contract on the MATIF. Market makers
on the EFX 50 future contracts included SocGen and BNP
. OMF also provided clearing of the contracts and acted as a clearing house. It was granted a bank charter by the Banque de France. OMF was thus able to guarantee the trades. In July 1988 OMF was acquired by a consortium of French banks. OMF was later merged into MATIF SA which launched the CAC 40 futures contract.
Futures exchange
A futures exchange or futures market is a central financial exchange where people can trade standardized futures contracts; that is, a contract to buy specific quantities of a commodity or financial instrument at a specified price with delivery set at a specified time in the future. These types of...
and clearing house. In November 1987 Options Market France started publishing in association with the French bank CCF - now HSBC France - a stock index using the Reuters network under the symbol EFX 50. The index was computed from a basket of the 50 most liquid stocks traded on the Paris Stock Exchange, the Paris Bourse
Paris Bourse
The Paris Bourse is the historical Paris stock exchange, known as Euronext Paris from 2000 onwards.-History and functioning:...
. At the time the CAC 40
CAC 40
The CAC 40 is a benchmark French stock market index. The index represents a capitalization-weighted measure of the 40 most significant values among the 100 highest market caps on the Paris Bourse...
did not exist yet and the French stock exchange instead published at the end of each trading day a trend indicator of the French stock market computed using the closing value of the 240 largest stocks by market value. The EFX 50 was the first stock index in Paris with a streaming update based on the transaction prices of the underlying stocks.
In July 1988 it was granted authorization by the French Ministry of Finance to operate as a regulated Futures and Options Exchange. On July 21, 1988, OMF launched two contracts, a future contract on the EFX 50 and an option contract on the future. The contracts were traded electronically from workstations located in the dealing rooms of the exchange members. The contracts were cash settled. At its launch OMF exchange members included the large European, Japanese and American banks which also traded the notional bond contract on the MATIF. Market makers
Market maker
A market maker is a company, or an individual, that quotes both a buy and a sell price in a financial instrument or commodity held in inventory, hoping to make a profit on the bid-offer spread, or turn. From a market microstructure theory standpoint, market makers are net sellers of an option to be...
on the EFX 50 future contracts included SocGen and BNP
BNP Paribas
BNP Paribas S.A. is a global banking group, headquartered in Paris, with its second global headquarters in London. In October 2010 BNP Paribas was ranked by Bloomberg and Forbes as the largest bank and largest company in the world by assets with over $3.1 trillion. It was formed through the merger...
. OMF also provided clearing of the contracts and acted as a clearing house. It was granted a bank charter by the Banque de France. OMF was thus able to guarantee the trades. In July 1988 OMF was acquired by a consortium of French banks. OMF was later merged into MATIF SA which launched the CAC 40 futures contract.