Last Updated :
28 June 2010 at 16:50 IST
US movie futures destined for premature death
WASHINGTON, DC (Commodity Online): With the US congressional conference approving a ban on movie box-office futures trading, the novel concept mooted by Media Derivatives, Inc looks destined for a premature death in USA.
A few weeks ago the US commodity markets regulator, the Commodity Futures Trading Commission (CFTC) had approved the Weekend Motion Picture Revenue futures and options contracts submitted by Media Derivatives, Inc. (MDEX) for trading even as it had opposition from the Hollywood industry as film makers felt ti could damage the movie industry.
CFTC said that the contracts do not violate the Commodity Exchange Act or the Commission’s Regulations. The “movie futures” consist of a collared futures contract and a binary call option contract on Opening Weekend Motion Picture Revenues for the motion picture, Takers. The contracts are intended to allow participants in the motion picture industry to manage the financial risks associated with the production and distribution of motion pictures.
The CFTC approved the establishment of the Trend Exchange and another exchange for futures, the Cantor Futures Exchange.
The amendment to the financial reform bill, which would ban derivatives trading based on box-office results, was approved Friday morning by a House-Senate conference committee, The Hollywood Reporter said.
Derivatives are contracts that have value based on stocks, bonds, loans, currencies or commodities that are tied to an event such as box-office results.
Critics of the proposal to legalize box-office futures fear speculators or rival studios would use such a futures market to bet against a movie's success.
The conference committee's chairman, Rep. Barney Frank, D-Mass, said the House conferees agreed with the amendment. It had support from the Motion Picture Association of America, which represents major studios, as well as from Hollywood talent guilds and movie exhibitors.
Congress is expected to pass the conference committee version of the bill.
NCDEX SOYBEANINDOREJUN12 20 June 2012
contract was trading at
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