The introduction of exchange‐traded options in 1973 led to explosive growth in the stock options market, but put and call options on equity securities have existed for more than a century. Prior to the listing of option contracts, trading was conducted in an order‐driven over‐the‐counter market. From 1873 to 1875, quotes for options contracts were published weekly in The Commercial and Financial Chronicle during a period that saw extensive marketing efforts by a number of brokerage firms. In this article we examine these quotes to determine why this seemingly sophisticated market existed for only a brief period in financial history.

This paper examines the impact from changing the trading mechanism at the Riga Stock Exchange (RSE). All three trading lists that once traded in a daily call auction followed by fixed price trading were transferred to a mechanism where the call auction is followed by continuous variable price trading sessions. We find that for stocks with high liquidity before the transfer, trading volumes more than doubled, while for stocks with low liquidity before the transfer, trading volumes fell to less than a quarter of their pre-transfer levels. The functions of a stock market in providing price discovery and a secondary market for shares were eroded for more than half of the securities listed.