The International Securities Exchange will list contracts of the social networking site Facebook this month that would enable people to gain exposure to its shares and hedge investments.
In a statement, ISE announced that “it will list options on Facebook beginning May 29“.
The options listing date is contingent upon a successful completion of Facebook’s IPO, it added.
Futures contracts, forward contracts and options are the most common types of derivatives, generally used as an instrument to hedge risk from an underlying asset.
Facebook is planning to raise more than $12 billion in its initial public offering this week. The company is expected to go public on May 18 and the stock will be listed on Nasdaq under the symbol ‘FB’
With 901 million users as on March 31, 2012, Facebook is the most popular social networking site in the world and a magnet for advertisers.
The ISE, which is owned by derivatives exchange Eurex, operates a leading US options exchange and offers options trading on over 2,000 underlying equity.