Regulators OK Box-Office Futures Trading

Thanks to key approval from federal regulators on Friday, box-office futures could become a traded commodity in the near future. Media Derivatives received the green light to launch its Trend Exchange, known as TrendEx, which would allow participants to bet on hit movies, though it still needs to get permission to trade specifically in futures tied to box-office receipts. TrendEx, like its rival Cantor Exchange, says that this secondary market in the movie business could become an essential instrument for hedging investments, but Hollywood has yet to buy into it—the MPAA has been one of its most outspoken critics. "If they don't let a product like this become available, it's not hurting the big studios, it's hurting all the independents," TrendEx CEO Robert Swagger said. Financial-reform legislation being discussed in the Senate may contain provisions that would ban box-office derivatives.