Eurex Reports Weak Derivatives Demand for July

Monday, 10/08/2020 | 11:21 GMT by Arnab Shome
  • The OTC market remained strong year-on-year, but slumped dramatically compared to June.
Eurex Reports Weak Derivatives Demand for July
Finance Magnates

Eurex, a subsidiary of the Deutsche Börse Group, has published its monthly volumes today, showing a decline across all classes of derivatives products in July on a year-on-year basis.

The Exchange pointed out that the European equity derivatives took the worst hit with a year-on-year decrease of 23 percent in the monthly volume.

For the entire derivatives market, including European equity index derivatives and European interest rate derivatives, Eurex witnessed a total year-on-year fall of 13 percent with a monthly volume of €1.12 billion, compared to €1.3 billion in the same month the previous year.

According to the exchange, the ongoing uncertainty in dividend pricing is a challenge in the market.

Notably, in June, the European exchange reported excellent figures almost across all sectors. Though, Month-on-month, the total derivatives market decreased by 41.6 percent.

OTC Market Remained Positive Overall

However, coming to the over-the-counter (OTC) clearing market, most of the reported numbers were positive for the month.

The average daily cleared volumes dropped by 13 percent in July to €99 billion, compared to the previous year’s same month’s figure of €114 billion, because of the reduced volumes in Forward Rate Agreements.

The notional outstanding volumes for the OTC market increased by 53 percent, while the interest rate Swaps remained a solid performer with an uptick in the average daily cleared volumes by 27 percent year-on-year.

In the repo market, Eurex’s business grew to €86.9 billion of average term-adjusted volume, growing 37 percent year-on-year.

The Eurex commodities market, however, echoed the derivatives segment and witnessed declines across all major product suites.

Meanwhile, Eurex is going to launch options on Euro-Buxl Futures (OGBX) next month, thus, offering hedging and trading opportunities at the very long end of the interest rate curve.

Eurex, a subsidiary of the Deutsche Börse Group, has published its monthly volumes today, showing a decline across all classes of derivatives products in July on a year-on-year basis.

The Exchange pointed out that the European equity derivatives took the worst hit with a year-on-year decrease of 23 percent in the monthly volume.

For the entire derivatives market, including European equity index derivatives and European interest rate derivatives, Eurex witnessed a total year-on-year fall of 13 percent with a monthly volume of €1.12 billion, compared to €1.3 billion in the same month the previous year.

According to the exchange, the ongoing uncertainty in dividend pricing is a challenge in the market.

Notably, in June, the European exchange reported excellent figures almost across all sectors. Though, Month-on-month, the total derivatives market decreased by 41.6 percent.

OTC Market Remained Positive Overall

However, coming to the over-the-counter (OTC) clearing market, most of the reported numbers were positive for the month.

The average daily cleared volumes dropped by 13 percent in July to €99 billion, compared to the previous year’s same month’s figure of €114 billion, because of the reduced volumes in Forward Rate Agreements.

The notional outstanding volumes for the OTC market increased by 53 percent, while the interest rate Swaps remained a solid performer with an uptick in the average daily cleared volumes by 27 percent year-on-year.

In the repo market, Eurex’s business grew to €86.9 billion of average term-adjusted volume, growing 37 percent year-on-year.

The Eurex commodities market, however, echoed the derivatives segment and witnessed declines across all major product suites.

Meanwhile, Eurex is going to launch options on Euro-Buxl Futures (OGBX) next month, thus, offering hedging and trading opportunities at the very long end of the interest rate curve.

About the Author: Arnab Shome
Arnab Shome
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Arnab is an electronics engineer-turned-financial editor. He entered the industry covering the cryptocurrency market for Finance Magnates and later expanded his reach to forex as well. He is passionate about the changing regulatory landscape on financial markets and keenly follows the disruptions in the industry with new-age technologies.

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