Goldman, JP Morgan, Morgan Stanley join Eurex credit programe

Eurex, which launched the Credit Index Derivatives Partnership Program on August 1, said Banco Santander, BNP Paribas, Flowtraders, Goldman, Jane Street, JP, Morgan Stanley and Susquehanna International Group are the scheme’s inaugural members.

The credit partnership program offers participants financial incentives in return for obligations to quote prices in the futures products, thereby supporting liquidity and potential attracting other clients.

Joe Paccione, Americas head of Futures and Options Sales and Execution, and Sanaz Fazeli, co-head Global Macro Credit Sales at JP Morgan, said: “Credit index futures are a valuable addition to further broadening the scope of macro credit products we trade. Reception from our clients to this product has been robust and we view the extension of the program as a very positive step to continue to build on the global liquidity pool for listed credit derivatives.”

The credit derivatives scheme is an extension of Eurex's revenue-sharing programs for short-term interest rate (STIR) futures and interest rate swaps rolled out in 2023.

Joseph Nehorai, global head of Futures and Options Execution Sales at Goldman Sachs, said: “We are pleased to see Eurex extend their Partnership Program to include credit futures. Our commitment remains as strong as day one, this is well timed to capture the rise in adoption of credit futures by our clients.”

Frankfurt-based Eurex launched its first US dollar credit futures in September last year, adding to the European credit futures made available in September 2021. The firm also has pound sterling and emerging market sovereign futures based on Bloomberg Index Services benchmarks.

Matthias Graulich, member of the Executive Board of Eurex, said: “By fostering liquidity in Eurex's Credit Index Derivatives, we're accelerating electronification and standardisation for a more efficient and accessible market, strengthening Eurex's leadership in listed fixed income and delivering our enhanced value proposition globally.”

Exchange-traded credit derivatives is a congested space.

Cboe Global Markets in 2018 launched its iBoxx iShares US dollar denominated corporate bond futures, covering the investment grade and high yield markets. This was followed in June last year by an iBoxx $ Emerging Market Bond Index (IEMD) future.

CME Group listed its first US corporate bond index futures in June last year, marking its first foray into the market.

Intercontinental Exchange (ICE) in December launched four MSCI MarketAxess index contract marking the US group’s entry into the asset class.

Speaking in June as Eurex announced its plan to launch the credit futures program, Eurex's global product lead for credit derivatives Davide Masi said the scheme is “the last piece of the puzzle that we want to add to our credit ecosystem”.