Michael Peters, member of the Eurex executive board

Eurex plans to expand European index derivatives segment

International derivatives exchange Eurex plans to extend its offering of futures and options on European size indices provided by Stoxx.

Four futures and four options based on the Euro Stoxx and the three corresponding sub-indices Euro Stoxx Large, Mid and Small will be tradable as from 28 July.

The new derivatives will enhance the existing offering of four futures and four options based on the Stoxx Europe 600 Index and the three sub-indices Stoxx Europe Large 200, Stoxx Europe Mid 200 and Stoxx Europe Small 200.

“By extending our offering to include new euro-denominated index derivatives, we will create additional investment and hedging opportunities for clients who want to gain exposure without currency risks on the basis of compact underlyings,” says Michael Peters, member of the Eurex executive board. “The new Euro Stoxx index products will also complement our highly liquid future on the European blue-chip index Euro Stoxx 50.”

As is the case with existing Eurex index products, the new futures will be settled in cash. The expiration dates will also be in March, June, September and December. An incentive programme for market makers will be in place for several months to support sufficient liquidity from the outset.

Eurex has been offering derivatives on the four Stoxx Europe 600 indices since 2005. In 2009, approximately 730,000 contracts based on these index derivatives were traded; open interest currently is at approximately 30,000 contracts.

The Stoxx Europe 600 Index contains 600 companies from 18 European countries. The 600 index constituents are split into three groups of 200 according to their market capitalisation – representing the three sub-indices Stoxx Europe Large 200, Mid 200 and Small 200.

As of 28 July, the contract size of the Stoxx Europe 600 derivatives already listed will be adjusted to be consistent with the new products. Alongside the four listed futures and options, each bearing a contract value of EUR200 per index point, additional futures and options with a value of EUR50 per index point will be launched.

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