London's International Financial Futures and Options Exchange (Liffe) has initiated dealing in Universal Stock Futures, a move billed by the London exchange as a "revolution in global equity trading".
For the first time, says Liffe, customers can buy and sell futures contracts on 25 blue-chip stocks listed in the UK, continental Europe and the US, on one electronic trading platform, Liffe Connect, cleared and settled through one clearing system and traded under one regulatory regime.
With a combined market capitalisation of £2.3 trillion (?3.8 trillion), Universal Stock Futures provide easy, cheap and efficient access to highly liquid stocks in the key pharmaceutical, telecoms, technology, oil and banking sectors, claims the exchange. Liffe has invested heavily in the launch of the products, which it says provide exposure to global share price movements with no currency exchange costs or stamp duty and without the costs associated with transferring ownership of shares.
To encourage trading, Liffe is to offer investors free, real-time online prices as well as news on the stocks and other services via its new information portal, www.universal-stockfutures.com.
Hugh Freedberg, Chief Executive of Liffe says: "Today, Liffe has begun a revolution in global equity markets by offering a single access point to trade global equities cheaply, easily and efficiently. The days of high-price, high-margin exchange trading in an environment of prohibitive taxes and regulation must surely be numbered. Free, real-time prices over the Internet will make this market even more transparent for retail brokers and smaller investors."
Liffe announced its initial tranche of fifteen Universal Stock Futures contacts in September last year, increasing the number to twenty-five in December. Eight designated market makers were announced earlier this month.