Euro clearing volume heats up at Eurex even as equity derivatives cool

abdelaziz Fathi

Eurex, the European derivatives exchange owned by financial titan Deutsche Börse Group, today reported record volumes in euro clearing as investors are turning to place high bets on the ECB’s monetary policy.

During January 2022, average daily cleared volumes in OTC interest rate derivatives grew to a record level of EUR 276 billion, which translates to a total of EUR 5.8 trillion.

In addition, overall notional outstanding grew to a record volume of EUR 24.560 billion at the end of January, despite several compression runs during the last months. Market share in notional outstanding stood at 22 percent in January.

Eurex disclosed that a total of 133 million contracts were traded across its financial derivatives, which include European equity index, interest rate, and equity derivatives. This figure was higher by three percent over a yearly timeframe, compared to 129 million contracts reported back in January 2021.

Meanwhile, Eurex’s OTC clearing business saw strong gains over the last year, with total volumes jumping 20 percent in January to EUR 24.5 trillion from 20.3 trillion EUR in the same month last year. In terms of its average daily cleared volumes, the ADV figure rose 3 percent year-on-year to EUR 78 billion in January from EUR 76 billion a year earlier.

More positive metrics

Also, in its listed business Eurex saw a good start into the new year. In terms of traded contracts, equity index derivatives stood out in particular, growing by 6 percent year-on-year to 65.7 million in January. Interest rate derivatives contracts traded also grew  by 4 percent to 45.2 million year-on-year. Equity derivatives, however, showed negative growth of 7 percent, falling year-on-year to 22.3 million contracts in January.

At Eurex Repo, the electronic marketplace for secured funding and financing, overall average monthly term-adjusted volumes increased by 62 percent year-on-year, from EUR 123.8 billion to 200.6 billion. This growth was driven in particular by the Repo Market, where volumes more than doubled (+119 percent) compared to the previous year, from EUR 61.1 billion to EUR 133.7 billion.

The Eurex FX offering of classic FX futures and options, in combination with the rolling spot futures, allows traders to manage their FX exposures with listed products.

The pan-European exchange has made efforts over the past year to expand its FX trading business, most recently signing major banks to support their FX futures, from clearing to trading.

Eurex’s currency trading desk currently offers various FX derivatives products, including FX futures available in 19 currency pairs, all with quotation and tick sizes in-line with existing OTC FX standards. A liquidity scheme caters for tight pricing and competitive liquidity, it says.

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