Forget China, derivatives are the hottest IPOs

Posted by: Aaron Pressman on November 17, 2006

It’s no secret that shares of derivatives exchanges like the Chicago Board of Trade (Symbol: BOT) and Chicago Mercantile Exchange (CME) have been among the best performers of the year. Hedge funds, pension funds, everybody is using the exchange’s listed derivatives more, whether futures on barrels of oil, options on exchange-traded funds or even the new contracts on regional home price indexes.

The CBOT, which announced the other day that it had broken its annual trading volume record for the fifth year in a row, has seen its shares fly up over 60% this year. The CME’s shares are up more than 40% with the latest surge pumped up by the exchange’s $8 billion offer for its cross-town rival.

Into the fray today comes the debut of the New York Mercantile Exchange known as Nymex (NMX). It went public at $59, just a tad over the recently upped price range of $54 to $57 the company expected in its last SEC filing. At a closing price around $132, it easily beat the previous record holder for opening day gains in 2006, Chipotle Mexican Grill, which exactly doubled in its January debut. That puts the cap on a wild and crazy week in the IPO market which saw nine deals come to market including the lackluster debut of Hertz (HTZ), cash cow to the LBO stars.

Reader Comments

Eli Nahass

November 28, 2006 4:55 PM

Mr Pressman, Is there an ETF available at this time that would enable me to invest primarily in these market exchanges, like the New York Stock Exchange group ( NYX), and the Chicago Mercantile Exchange (CME), and the New York Mercantile Exchange ( NYMEX ), etc. Thank you for your time and response. Eli Nahass

Joakim Birkeli Jacobsen

March 31, 2009 4:43 AM

Nailed it!

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About

Bloomberg Businessweek’s Ben Steverman focuses on the latest moves in financial markets and emerging trends in stocks, bonds, and funds, always with an eye toward giving readers a better understanding of the sometimes confusing and often chaotic world of money. Standard & Poor’s senior index analyst Howard Silverblatt will also provide his take on companies’ finances and the markets. Voted one of the “Top 100 Finance Blogs” in 2007.

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