One of the most recent battlegrounds in the European derivatives market is over equity options, with Eurex and Euronext Liffe competing both against each other and the OTC market. FO Week asked representatives of both exchanges for their views on how they are going about gaining the upper hand in equity options, and how they are growing the market overall. This week, Liffe executive director of marketing Fraser Cowie told Elliott Aykroyd about his exchange's plans
What is it about the equity options market in Europe
which you believe makes it suitable for trading through
The actual products that are traded, whether they be traded
on exchange or OTC, are largely exchange-designed contracts.
For certain users, within the mandate of say a fund manager or
an insurance fund, they must trade on exchange, they must be
able to show best execution, that the trade must be reported to
the market so that there is transparency to the users of those
funds. There are peculiarities to equities that are not there
in other markets, for example corporate events; the handling of
corporate actions is a key thing when somebody is taking on a
long-term position. The exchanges determine corporate actions
policy and we have harmonised that policy across markets, that
brings a lot of certainty to people. That is not the case in an
OTC market where it can be completely unpredictable.
This article is available exclusively to subscribers
Please log in to continue reading.
Not yet a subscriber?
Click here to take a free trial.
Already have an account? |
Please fill in your details below and a customer service representative will contact you.