European Eurex customers recently voiced their concerns about the exchange's plans for global clearing and extended trading hours across two platforms, at a forum hosted by
FOW (see FO Week Vol 10 No 14). This week, Laurence Davison reviews the forum and explores the views of European market participants in more depth, as well as hearing Eurex's responses to the issues raised.
The majority of concerns voiced by participants at the forum
were rooted in Eurex's decision to extend trading hours by
utilising two exchange platforms, Eurex and Eurex US, and two
clearinghouses, Eurex Clearing and The Clearing Corporation
(C-Corp). FCMs pointed out that other exchanges, such as
Chicago Mercantile Exchange (CME), had extended hours on a
Currently, trading on Eurex in Europe ends at 6.00pm (GMT).
However, when phase two of its global clearing link goes live
following US regulatory approval - widely expected to be around
the middle of this year - the exchange will close at 4.35pm and
business will be forced to transfer to Eurex US, which will be
the venue for euro denominated products for the rest of the
23-hour trading day.
The plan has not been widely welcomed. Richard Berliand,
global head of futures at JPMorgan, told the forum that users
will have to, "undertake the significant task of interfacing
with a second exchange and all the costs associated with that
connectivity. It drastically increases the complexity, and we
have a number of clients saying they will not bother trading
after the 4.35pm cut-off point because of the cost of doing
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