* Nasdaq OMX gains ground in battle for market share
* CBOE stays No. 1 in total market share last month
* ISE's overall market share fell to 19.4 pct in March
* ISE:Inclusion of dividend trades distorts US volumes
CHICAGO, April 1 The two dominant U.S. option
exchanges on Thursday reported a decline in overall options
market share last month as rival venues grabbed a bigger slice
of volume in the fast-growing options business.
Eight option venues are now battling for order flow
following the February launch of BATS Options.
Nasdaq OMX Group (NDAQ.O), which runs the Nasdaq PHLX and
NOM option platforms, accounted for a combined 25.57 percent in
option trading, giving them the No. 2 spot behind the Chicago
Board Options Exchange, according to the Options Clearing
NYSE Euronext's NYX.N two venues, AMEX and NYSE Arca
options, together captured 23.40 percent of market share,
overshadowing the long-running No. 2 player International
Dropping to the No. 4 spot was ISE, owned by Deutsche
Boerse AG's (DB1Gn.DE) derivatives exchange Eurex.
ISE said its total market share fell to 19.4 percent in
March from 22.8 percent in February and 28 percent in March
Daily average trading at ISE fell 32.6 percent to 3 million
contracts last month from 4.4 million a year earlier.
CBOE was still the top market among exchange operators.
CBOE accounted for 30 percent of the options market last month,
down from 30.7 percent in February and 31.5 percent in March
2009, the market said separately in a volume report.
Trading at CBOE, ISE's bigger rival, fell 8 percent in
March compared to a year earlier, at an average of 4.5 million
contracts a day.
For the first quarter of 2010, CBOE average daily volume
rose 2 percent from the same period a year ago.
Trading at all U.S. options markets last month rose 1.44
percent to 351 million contracts from 346 million in March
2009, the Options Industry Council said in a report.
ISE, which has long been a vocal critic of ex-dividend
trades, said its market share data continue to be negatively
affected by this specialized trading strategy which temporarily
inflate and distort trading volume.
Excluding dividend trading, ISE said its March market share
in equity options would have been 22.3 percent, more than the
20.6 percent it reported.
The exchange said last month in a paper on the practice
posted on its website that inclusion of dividend trades
inflated the reported market share of some options exchanges.
For details, see [nN01253514].
(Reporting by Doris Frankel; Editing by Kenneth Barry)