1 Table of Contents Ñ e-Options Market Picture The e-Trading Ratio vs. Voice The e-Trading Ratio vs. Voice per Geographical Zone Ñ e-Options Market Actors Sell-side • Inter … … Marketplaces• DTC Market organisation Buy-sideÑ How Much of this Activity will End up on Line? Main Drivers for e-FX Options Market Growth Issues around the Adoption of Electronic Trading in e-FX Options Ñ Next Chapters on e-FX options Different phases Algorithmic Trading Ñ Conclusion …

Market Picture: e-Option Trading per Geographic Zone Ñ In North America and Europe, the overall level of e-trading in FX options is around 20% . It is estimated to be close to 5% in Asia Source: Federal Reserve Bank of NY, B.I.S, E.C. B, Japan Securities Dealers Association Average Daily Volume Traded in FX Options by Region (US$ Billion) 75 46 22 21 11 1 22% 5% 19% 0 20 40 60 80 100 120 Europe North America Asia US$ B illio n Voice Brokered Electronic ally Traded Market Picture: Main Inter-dealers Marketplaces Ñ There are three dominant platforms in the FX options space: Volbroker/ICAP, Reuters & GFI Ñ But only Reuters is a pure e-trading platform, the two other platforms operate electronically and by voice Ñ It is therefore questionable to consider as pure e-trading the volume that goes through their platform Marketshare of leading Inter-dealer Platforms in E-FX Options Reuters Dealing 3000 25% Volbroker/ICAP 40% GFI 20% Others 15% 5 DTC e-Options Market Actors: Sell-side (1/2) A Very Disparate Market Ñ In the Dealer to Client space, the market is dominated by a handful of bank’s single dealer site: Barx UBS/CitiFX/Autobahn FX … Ñ Potential new comers: the new comers are multi-dealer platforms Hotspot FX • The Dealer to Client FX platform is actively looking to enter the FX options market ISE FX options • Launched in April 2007, its average daily volume is approaching 3,000 contracts. Open interest in ISE FX options has recently reached over 100,000 contracts

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