ISE Intl Secs Exchange Hldgs

The International Securities Exchange, Inc. (NYSE:ISE) today reported average daily trading volume for equity and index options contracts for December 2005. Average daily trading volume increased 22.3% to 1.8 million contracts per day as compared to 1.5 million contracts per day during the same period in 2004. Total equity and index options volume for the month increased 16.7% to 37.7 million contracts from 32.3 million contracts in the same year-ago period. For the year 2005, average daily trading volume of equity and index options increased 24.3% to a record 1.8 million contracts traded as compared to 1.4 million contracts traded in 2004. Total equity and index volume for 2005 increased 24.3% to 448.7 million contracts from 360.9 million contracts in 2004. -0- *T Equity and Index Options Volume Statistics Current Month Year-to-Date (000s) Dec-05 Dec-04 % Change Dec-05 Dec-04 % Change ---------------------------------------------------------------------- ISE Average Daily Volume 1,796.7 1,469.2 22.3% 1,780.5 1,432.0 24.3% ISE Total Volume 37,730.8 32,321.9 16.7% 448,695.7 360,852.5 24.3% Industry Average Daily Volume 6,539.7 4,777.6 36.9% 5,968.9 4,689.7 27.3% Market Share 27.5% 30.8% (3.3) 29.8% 30.5% (0.7) pts pts ISE Market Share: Customer 30.7% 31.5% (0.8) 30.3% 27.5% 2.8 pts pts ISE Market Share: Firm 18.7% 19.9% (1.2) 22.0% 20.1% 1.9 pts pts ISE Market Share: Market Maker 27.4% 32.6% (5.2) 31.5% 36.1% (4.6) pts pts ---------------------------------------------------------------------- Equity Options Volume Statistics Current Month Year-to-Date (000s) Dec-05 Dec-04 % Change Dec-05 Dec-04 % Change ---------------------------------------------------------------------- ISE Average Daily Volume 1,775.2 1,468.9 20.9% 1,762.8 1,431.6 23.1% ISE Total Volume 37,278.8 32,315.0 15.4% 444,231.1 360,769.2 23.1% Industry Average Daily Volume 5,998.1 4,375.0 37.1% 5,432.7 4,300.2 26.3% Market Share 29.6% 33.6% (4.0) 32.5% 33.3% (0.8) pts pts ISE Market Share: Customer 33.1% 33.7% (0.6) 32.7% 29.4% 3.3 pts pts ISE Market Share: Firm 20.8% 23.0% (2.2) 24.7% 22.5% 2.4 pts pts ISE Market Share: Market Maker 29.3% 35.9% (6.6) 34.3% 39.7% (5.4) pts pts ---------------------------------------------------------------------- Index Options Volume Statistics Current Month Year-to-Date (000s) Dec-05 Dec-04 % Change Dec-05 Dec-04 % Change ---------------------------------------------------------------------- ISE Average Daily Volume 21.5 0.3 N/M 17.7 0.3 N/M ISE Total Volume 452.0 6.9 N/M 4,464.6 83.4 N/M Industry Average Daily Volume 541.6 402.7 34.5% 536.1 389.5 37.6% Market Share 4.0% 0.1% 3.9 3.3% 0.1% 3.2 pts pts ---------------------------------------------------------------------- *T Increasingly in 2005, and particularly in December, we witnessed an increase in trading activity among options market makers on the Philadelphia Stock Exchange and Pacific Exchange to profit at the expense of investors who fail to exercise their call options immediately prior to a stock going ex-dividend. The trades are transacted in very large quantities in "in-the-money" call options on the day before the ex-date and occur on exchanges that reduce their transaction fees to attract these trades. In December, if the volume from the largest dividend trades were excluded from the monthly data, ISE's market share of equity options would increase from 29.6% to 32.1%. "We continue to focus our attention on absolute volume growth driven by Customer and Firm trading activity," said David Krell, ISE's President and Chief Executive Officer. "Ultimately, the success of an exchange must be based on its acceptance by these two constituencies. I am pleased to note that ISE remains the number one venue for Customer and Firm combined trading activity in equity options." Monthly Highlights -- ISE was the largest U.S. equity options exchange in December. -- ISE was the largest U.S. equity options exchange in 2005. -- On December 8, 2005 ISE announced the pricing of its secondary offering of Class A common stock at $30.00 per share. The offering consisted of 8,000,000 shares of Class A common stock, all of which were sold by existing stockholders. -- ISE traded more volume in 566 of 837 issues in its listings than any other options exchange. ISE Background The International Securities Exchange, the world's largest equity options exchange, was founded on the principle that technology fosters and infuses new efficiencies and operational innovations into securities trading. After developing an innovative market structure that integrated auction market principles into an advanced screen-based trading system, ISE launched the first fully electronic US options exchange in May 2000. ISE continually enhances its trading systems to provide investors with the best marketplace to execute their options orders. For more information about ISE, its products and its technology, visit www.iseoptions.com. This press release contains "forward looking statements." These statements relate to future events or our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements, to be materially different from those contemplated by the forward looking statements. We undertake no ongoing obligation, other than that imposed by law, to update these statements. Factors that could affect our results, levels of activity, performance or achievements and cause them to materially differ from those contained in the forward looking statements can be found in our filings with the Securities and Exchange Commission, including our registration statement on Form S-1, current reports on Form 8-K and quarterly reports on Form 10-Q, as amended.