| The purpose of this study was to evaluate the perceptions of professional stock options traders towards the competitive changes in the structure of a traditional floor-based options exchange, and to extend the trading industry literature beyond theoretical models of exchange microstructure. Respondents were asked for their opinion about differences between traditional exchanges and screen-base exchanges in areas identified as critical to trade execution: price discovery, market liquidity, transaction costs, and market structure and market efficiency. The sample was distributed among the exchange industry job types. The sample was not skewed toward any age group, but was reflective of the larger trading industry in that the respondents were predominantly male. The results of the study indicated that there is a difference in the options market professionals' perception of price accuracy between exchange types. Additional results showed that most professionals indicated they are not concerned about issues surrounding exchange markets and the Efficient Market Hypothesis, and generally disagreed with the necessity of market liquidity for order execution. Finally, the respondents displayed a tendency toward disagreement when considering the relative importance of specific exchange features. |
