The number of exchange-traded derivatives (ETD) worldwide increased by three per cent in 2013 to 22 billion contracts, according to statistics compiled by the World Federation of Exchanges (WFE).
The WFE, which annually conducts a survey on derivative markets, found that in 2013, 22 billion derivative contracts (12 billion futures and 10 billion options) were traded on exchanges worldwide – a 685 million increase above derivatives contracts traded in 2012.
The drop in equity derivatives (-5.3 per cent) is mainly explained by the size changing of the KRX (Korea Exchange) KOSPI 200 contracts, the weight of which is very significant. The overall 2013 equity derivatives volume increased by 3.2 per cent when those contracts are excluded from the statistics.
The volume of interest rate options and futures traded increased significantly (+13 per cent) after the sharp decline observed in 2012 (-15 per cent). Both short term and long term segments experienced vivid growth.
Currency derivatives increased in volume by 2.2 per cent in 2013.
Commodity derivatives (+23 per cent) saw the greatest increase in volume in 2013, largely as a result of two major factors: the transfer of cleared OTC energy swaps to futures in the United States by the InterContinental Exchange (ICE) in 2012 in anticipation of the final Dodd-Frank regulatory requirements; and the continuing sharp increase in volume at Mainland Chinese Exchanges (+40 per cent). The US and Mainland China accounted for 79 per cent of the global volumes in 2013.
The “other derivatives” category comprises a wide range of products including volatility index options, exotic options and futures, REIT derivatives, dividend and dividend index derivatives or CFDs. Volumes in this category increased sharply (+38.5 per cent) in 2013, highlighting the ongoing innovation in derivatives offered by exchanges.