BM&F Bovespa and CETIP are readying a series of initiatives that should incentivise diversity in an equity options market dominated by just two names. Elise Coroneos reports.
Brazil’s equity options market may be one of the largest in the world but it’s also — perversely — a comparatively shallow one. That’s because Brazil is home to the two most traded equity options in the world — those representing Vale, formerly known as Companhia Vale do Rio Doce, the large multinational mining corporation, and Petrobras, the largest company in Latin America by market capitalisation and revenue.
The leap in growth seen on Brazil’s equity options market — the number of trades increased from 11.8m in 2008 to 14.9m in 2009 — was, however, largely driven by the increase in trading in these two names, according to data from the International Options Market Association, which represents a global group of exchanges...