Eurex Exchange is to offer a new interest rate future based on the long-term bonds issued by the Spanish government, starting 26 October 2015.
The new Euro-Bono-Futures contract represents an important addition to the existing range of efficient and cost-effective hedging instruments on the European government bond market, complementing Eurex’s already listed long-term interest rate derivatives products such as Bund-, BTP- and OAT-Futures.
“With the introduction of this contract, we are responding to the significant interest from our participants in more customised hedging solutions and in new spread trading opportunities,” says Eurex Executive Board member, Mehtap Dinc.
Eurex Exchange offers a designated market-making program to create and develop a liquid order book. A number of Eurex market participants have already expressed their interest in the program.
The long-term Euro-Bono Future is based on deliverable bonds with a residual maturity of 8.5 to 10.5 years and an original maturity of no more than 20 years. As with the existing government bond futures contracts, the notional coupon will be 6 percent and the contract value 100,000 euros. The minimum tick size will be fixed at 0.01 percent (10 euros per tick) in line with the tick sizes of the other Eurex interest rate futures. Trading hours will be from 8 am to 7 pm CET.