NEW YORK -- For the second time this year, the American Stock Exchange has' opened trading in Merrill Lynch & Co. warrants based on changes in interest rates. The 2.2 million CMT yield increase warrants are tied to the two-year Constant Maturity Treasury yield. The warrants are expected to increase in value if the yield to maturity on Treasury notes with a constant maturity of two years moves upward, the volatility of the CMT yield increases, or general interest rates rise.
The two-year increase warrants follow the listing of warrants based on the movement of the five-year Treasury yield on the AMEX last January. Since launched, they have averaged more than 9,000 warrants a day.