SEC lifts final barrier to single-stock futures trading

The final barrier to the trading of single-stock futures (SSFs) in the US was removed yesterday when the Securities and Exchange Commission (SEC) approved customer margin rules. Earlier this month, the SEC’s regulatory partner, the US Commodity Futures Trading Commission (CFTC), also approved final rules for the use of the instruments.

SSFs, which are contractual agreements to buy or sell shares of an individual company at a given price on a set future date, could start trading as early as September, according to James Newsome, CFTC chairman. Both the SEC and the CFTC agreed to set minimum margin levels at 20% of current market value.

Two years ago, the US Congress lifted a 20-year ban on SSF trading, authorising trading to commence from August 21, 2001. But work on implementing a regulatory framework, particularly on margining

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