Tase launches options and futures on Tel Aviv 100 index

The board of directors of the Tel Aviv Stock Exchange (Tase) has approved the launch of derivatives on the Tel Aviv 100 index (TA-100).

The new derivatives will be added to the exchange’s existing product range on a number of underlying assets – the TA-25 index, the TA-Banks index, the ILS/USD exchange rate, the ILS/Euro exchange rate and ten individual stocks included in the TA-100 index.

The decision to launch derivatives on the TA-100 was based on a number of considerations. Derivatives on the TA-100 will enable exchange-traded note (ETN) managers, as well as managers of mutual funds tracking the TA-100, to more effectively manage their exposure to the index while the high correlation between the TA-25 and TA-100 indices enables investors in the derivatives market to hedge activity in the TA-100 derivatives against activity in TA-25 index derivatives, Tase said.

“The launch of derivatives on the TA-100 index constitutes a significant step towards expanding the variety of derivatives traded on Tase,” said Robby Goldenberg, head of the trading, derivatives and indices department at Tase.

Goldenberg said the new derivative instruments will contribute to market efficiency, to the liquidity of all TA-100 constituent shares and to the growth of the trading volume of Tase’s stock and derivatives markets alike.

“Since the TA-100 index is perceived as best representing the Israeli economy, especially among foreign investors, the new derivatives will likely increase the attraction of investing in Tase for these investors as well,” Goldenberg said.

The derivatives on the TA-100 index are scheduled to begin trading on January 29 next year. In order to ensure adequate liquidity starting from the first day the new derivatives are traded, Tase said it will waive trading fees on these derivatives for the first three months.

According to SRP’s Israeli database there are not yet any structured deposits linked to the TA-100. However, the database does list 102 structured deposits linked to the TA-25 and 15 structured deposits linked to the TA-Banks index.