International Securities Exchange (ISE)
ISE PRODUCTS OF INTEREST
By FRANK KNEIPHER
Aug 15, 2007 - 9:44:44 AM

ISE – Products of Interest

Penny Pilot Expansion

On Friday, September 28, 2007 the ISE, in conjunction with the options industry, will expand the list of eligible securities in the penny pilot program and begin quoting and trading an additional 22 options classes in penny increments.

As part of the Penny Trading Pilot a select number of options may trade in 1-cent increments when priced below $3.00. Options priced $3.00 and above will trade in 5- cent increments. Please note that QQQQ will still be the only security permitted in 1-cent increments at all levels.

The new securities will be:

• SPY – SPDR S&P 500

• AAPL – Apple Inc.

• MO – Altria Group Inc.

• QCOM – Qualcomm Inc.

• DNDN – Dendreon Corp.

• AMGN - Amgen

• YHOO – Yahoo! Inc.

• OIH – Oil Services HLDRS

• GM – General Motors Corp.

• XLE – Energy Select Sector SPDR

• DIA – Diamonds Trust, series 1

• T – AT&T Inc.

• NYX – NYSE Euronext, Inc.

• CSCO – Cisco Systems,Inc.

• XLF – Financial Select Sector SPDR

• RIMM – Research in Motion Ltd.

• C – Citigroup Inc.

• AMZN – Amazon.com Inc.

• MOT – Motorola Inc.

• FCX – Freeport -McMoRan Copper & Gold Inc.

• COP – ConocoPhillips

• BMY – Bristol -Myers Squibb Co.

ISE Water Index (ISE_WTI)

The ISE Water Index (ISE_WTI) provides a benchmark for investors interested in this emerging sector. Companies with exposure to the global water industry have recently emerged as one of the most compelling investment themes. Increasing privatization of water system assets, an aging infrastructure, costly new regulatory guidelines, population increases in water stressed regions and industry consolidation have focused investor attention on companies with significant exposure to water. A natural resource with nosubstitute, water is considered by many to have similar characteristics to oil, in that the available supply is limited, and demand will increase exponentially from expanding global population and industrial demand.

The ISE_WTI has been created to provide investors with a product allowing them to quickly take advantage of both event-driven news and long term trends as this dynamic industry continues to evolve. The securities selected for the index derive a substantial portion of their revenues from the potable and wastewater industry.

Industry exposure includes water distribution, infrastructure (pumps, pipes and valves), water solutions (purification and filtration), and ancillary services such as consulting, construction and metering. Given the relatively small number of industry participants, investors in the ISE_WTI will benefit from targeted exposure in those companies that stand to benefit most from any industry-wide changes in a quick, affordable and convenient manner. The expanding range of conventional valuation metrics that have been afforded to industry participants over the last two years reflects the increasing awareness of the inherent prospects of companies involved in the water industry, and we anticipate increased volatility within this sector, which we expect will result in a substantial number of opportunities for investors to potentially profit from.