At its 11 February meeting, the Tel Aviv Stock Exchange (TASE) Board of Directors resolved to expand the array of TASE-traded equity options by approving the launch of options on Bank Discount and Mizrachi-Tefahot Bank shares and options on Ratio Oil Exploration LP, Avner Oil Exploration LP and Isramco Negev 2 LP limited partnership units.
Bank Discount and Mizrachi-Tefahot Bank stock options will join Bank Hapoalim and Bank Leumi options, enabling investors to incorporate investment strategies involving options on individual banks along with options on the TA Banks index in their portfolios.
The launch of options on the securities of the leading oil and gas exploration limited partnerships will enhance the ability of investors to hedge risk in this sector, which tends to be marked by highly volatile trading.
Option characteristics are identical to those of stock options currently traded on TASE:
TASE launched stock option trading on Bank Hapoalim, Bank Leumi, Israel Chemicals and Teva shares in 2009; and as of January 2011 average daily turnover in these options came to 5,600 contracts daily.
Rina Shafir, Senior Vice President, Trading & Clearing Department remarked, “TASE places great importance in development of its derivatives market. Increasing the number of TASE-traded stock options will contribute to market efficiency and will provide investors with additional tools for hedging their investments.”
The Board’s decision is subject to the approval of the Israel Securities Authority.
