Euronext has launched a range of Single Stock Dividend Futures on the most liquid stocks listed on its Amsterdam, Brussels, Lisbon and Paris markets.
The new dividend futures contracts will be available for trading in Q1 2015, starting with CAC 40 Index components. Euronext’s Single Stock Dividend Futures will offer investors additional dividend trading potential and will enable them to benefit from efficient pricing. The new products complement Euronext’s already existing dividend index offering made of the CAC 40 and AEX Dividend Index Futures.
Dividends are a key component for equity and equity derivatives holders and dividend futures are mostly used as a hedging tool. However, dividends are also becoming an asset class of their own offering strong diversification opportunities to investors. Jad Comair, Founder and CIO of Melanion Capital, a leading asset manager specialised in dividend investments, strongly believes in the dividend futures potential. According to Comair: “One day, investors will be able to trade dividend futures on every listed equity in the world.”
David Lenfant, co-founder of Laffitte Capital, an asset manager focused on absolute return UCITS funds, also welcomes the new launch. “In today’s markets our clients are in the search of yield. Euronext dividend derivatives offer our portfolio managers a wider range of investment opportunities on this innovative asset class,” he says.
The launch of the Single Stock Dividend Futures is supported by liquidity providers such as BNP Paribas and Societe Generale. Adil El Batji, Head of Delta 1 Europe at BNP Paribas, says: “Euronext's new derivatives offering will provide additional choice for dividend investments.”
Massimiliano Pignatelli, Head of Equity Forward Flow at Societe Generale, adds: “We are pleased to be associated as market maker to Euronext’s initiative to enter the single stock dividend futures space.”
Adam Rose, Head of Financial Derivatives at Euronext, says: “This is another great example of several new growth initiatives we are rolling out across the Euronext equity derivatives sector, to broaden the range of products we offer to our diverse client base. We are pleased to be able to launch these new dividend futures with such widespread client support.”
