Borsa Italiana has followed a growing number of its European counterparts by launching options with weekly expirations on its most liquid single stocks.
TheTRADEnews.com reported last week that Nasdaq Nordic had followed a recent move from Euronext to launch the products, which have traditionally been used more widely on US markets.
The contracts allow for more flexibility and the ability to act on or hedge short-term events, either macro-driven or relating to single companies.
Major European exchanges Eurex and Liffe already offer the weekly contracts.
“It is definitely a trend and several markets have expanded into this,” Nicolas Bertrand, head of equity and derivatives markets at the London Stock Exchange Group, which owns Borsa Italiana.
“We are trying to complete the array of possibilities for trading, in this case on the short-end of the curve. This gives investors the ability to be more precise in their investment and hedging strategies.”
Borsa Italiana has introduced the products on its IDEM derivatives market, with initial offerings on seven stocks, including Fiat, Telecom Italia and UniCredit.
The exchange took the decision partly due to demand from investors and also the success of its FTSE MIB weekly index options.
“For us, the FTSE MIB weekly options account for around 7% of volumes,” added Bertrand.
“You find this increasing when you have volatility, so it is probably not a product that is used on an on-going basis."