From Todd Wilemon:

“We’re on fire!”

No, not literally, but the options business here at NYSE Euronext is going gangbusters. Can I use a few more clichés before I get to the meat of the story?

With two months left in 2009, it is amazing what has taken place. Under the leadership of the Ed Boyle, Senior Vice President of US Options, and with the support of the entire organization, we have been setting goals and ruthlessly executing our plan to become the places to trade options both electronically and via open outcry. In the US, there are only four physical option trading floors and we operate two of them.

What a year 2009 is turning out to be for us in the options world.

After buying the Amex, we gave ‘em a brand new home, new technology, the fastest trading engines in the business and put together an amazing support staff made up of the very best of the Amex staff and our awesome NYSE Arca folks. This was for an exchange that had not updated their technology since the ‘90s. Oh yes, it was that bad… avert your eyes and just keep walking. The good news is that NYSE Amex technology now has the same “look and feel” of NYSE Arca, with its very own pro rata, customer-centric market structure.

At the end of last year, volume on the Amex had declined to a 5.7 percent share of total option volume among the seven exchanges. In seven short months since we opened the new NYSE Amex Options exchange at 11 Wall Street, we have increased NYSE Amex market share by 54%. Yes, you read that correctly, we have increased our market share by more than 50%. This was a mighty team effort of exchange staff in New York, Chicago, San Francisco and all of our customers. The trading firms along with their their desk and back office staff, the brokers, traders, clerks and exchange floor staff have caused a resurrection in the Amex. And let’s not forget NYSE Arca, where we implemented several new order types and increased throughput and capacity, and nobody here even has three hands! To all involved, take the weekend off and celebrate…you deserve it. (But make sure you come back Monday because we are not finished!)

Technology has been a key driver of our success. When we resurrected the Amex, it was through technology. A brand-spanking-new floor with the latest technology for our floor brokerage community to interface in an electronic environment, with an audit trail to ensure compliance with our exchange rules that assure transparency and fair orderly markets. For electronic business we left 100% of the legacy Amex technology behind and ported over production to a new, tested and proven technical infrastructure.

The success of the “new” NYSE Amex is a major contributor but not the only driver of our growth in options. We have been busy on other fronts as well. We have expanded our suite of order types on both exchanges including the PNP order types. PNP or Post No Preference ensures that orders that you want to stay on our exchange do not route out to another exchange. You can check out each of the PNP order types as well as our other innovations by looking at some of my previous blogs or by visiting our order types page here (for NYSE Arca) and here (for NYSE Amex).

Here at NYSE Euronext, we want to empower the trader to have as much control and say in how his order interacts with the marketplace.

We have new Complex Matching functionality on both exchanges to handle multi-leg option orders. On NYSE Arca, we also support options with stock orders. With the new matching engines we unveiled the PNP+Complex order type, which is designed to give price improvement over the leg markets. Not only is this order type innovative, it is dynamic in that it always keeps your order at an aggressive price in the market. Check out my PNP+Complex posts and the Amex Complex post for more information! Also, stay tuned because in Q1 2010 (just around the corner) we have more exciting news regarding our complex order functionality and pricing.

On another front, the Penny Pilot program is expanding. The penny pilot program has been a huge boon to investors and traders alike. It decreases the spread between the bid and ask thus saving investors money when they trade options. It is nice to keep more of your money in your own pocket. The Penny Pilot program promotes tighter markets while increasing transparency of screen markets. No longer do investors have to hope for price improvement in some dark opaque process. Pennies allow market makers and traders post their true markets on the screen.

Did you see the list for the expansion of issues traded in pennies? If not or want to peruse it again, please go here.

And if that is not enough, we also made some of our stakeholders stockholders in NYSE Amex. We partnered with seven firms in the new NYSE Amex Options exchange. As Ed Boyle said, “Having important partners in like this allows us to feel that we are building the structure in the right direction.” It is no exaggeration to say that for NYSE Euronext the best is not enough, we are pushing on all fronts to continuously improve

One last thing — so you are the first to know (between you me and the fence post) 2010 promises to be just as exciting for NYSE Euronext Options participants. 2009 is just the beginning. Keep checking back for more, we have a lot to tell you about in the coming months!

I have expounded enough about NYSE Arca and NYSE Amex, the “wonder twins” of options trading, so what do you think of us? Seriously, have you traded on our exchanges? We want you trading here.

Trade ‘em up!

TW

P.S. In my next blog I’ll fill you in on our progress getting the Universal Trading Platform (UTP) into production. This is a fundamental piece of NYSE Euronext’s ability to “Power the Exchanging World,” and it is pretty amazing stuff.