An analysis of single-stock futures trading in the U.S.
DOI:
https://doi.org/10.61190/fsr.v14i2.4818Keywords:
Security futures, Single-stock futuresAbstract
This paper presents an overview of how single stock futures (SSF) have developed since their introduction in the United States. We present a number of reasons why individual investor interest in SSF may not have reached its potential. Individual investors should note SSF volumes are very low and implied interest rates indicate that SSF settlement prices often have little relation to their respective underlying stock's closing prices. We present evidence of a number of non-dividend paying companies with underlying stock prices that closed above the settlement prices of their respective SSF, contradicting the carry arbitrage model.
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