Exchanges Are Pushing for Single-Stock Futures Plan

The U.S. government's ban on trading single-stock futures in the U.S. was supposed to be a temporary one. It has now been in place since the early 1980s.

But a U.S. futures industry concerned with competition from international and domestic rivals is pushing the government to lift the ban, which was part of the so-called Shad-Johnson Accord between the Securities and Exchange Commission and the Commodity Futures Trading Commission. Legislation is being drafted in Congress that would lift the ban on single-stock futures and sector-based index futures contracts, says John Damgard, president of the Futures Industry Association.

While futures seem too risky and esoteric for most individuals, investors could use the single-stock futures contracts the same way they use listed options -- to hedge existing positions or to speculate on future movement. ...