Heavy Use Of Equity Options By Investors Produced Open Interest Record In May

ChicagoJune 7, 1999

The Options Industry Council (OIC) announced today that equity options open interest - the total number of options contracts not yet exercised or allowed to expire - reached a one-day record high of 42,309,978 contracts on May 21, 1999. This exceeds the previous one-day record set in April 1999 by 1,515,316 contracts. Open interest is one indication of longer-term investing in equity options.

Equity options trading in May totaled 30,507,167 contracts, a 26 percent increase over the 24,171,731 contracts traded during the same period last year. Average daily volume for the month was 1,525,358 contracts, up from the 1,208,587 contracts traded in May 1998. Year-to-date contract volume is 164,447,962.

"With stock prices retracting in recent weeks, investors are becoming increasingly skittish about volatility," said Paul Stevens, OIC President. "The open interest figure indicates that many investors are using equity options to cope with market uncertainty."

An equity option is the right but not the obligation to either buy or sell 100 shares of stock at a predetermined price (strike price) on or before a fixed date (expiration date).

OIC, which includes the American Stock Exchange, Chicago Board Options Exchange, Pacific Exchange, Philadelphia Stock Exchange and The Options Clearing Corporation, has an extensive educational program.

The program, aimed at current and potential investors and their brokers, includes a web site at www.optionscentral.com, two instructional videos: "How To Optimize Your Stock Portfolio With Options" and "Investing with LEAPS®" available at 800/952-8665, and free evening seminars throughout the continental United States and Canada.

Interactive educational software, "The Options Toolbox," is downloadable for free from OIC's web site. A print and broadcast advertising campaign has resulted in more than 250,000 inquiries for literature and videotapes.

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