According to the International Swaps and Derivatives Association, notional outstanding number of OTC derivatives has diminished 10% since 2009. The options market has expanded by less than 2% and most of that expansion may be attributed to options on ETFs, research firm Tabb Group said. [A Look at Recent Trends in ETF Options Trading]
Henry Chien, analyst at Tabb, points out that “ETF options have been a big source of options volume and now account for 37% of volume,” an increase of 39% year-over-year as of August 2011. [Short ETFs – These Funds Profit When Stocks Fall]
For more information on ETFs, visit our ETF 101 category.
Max Chen contributed to this article.