Eurex to Introduce New Pricing Model Effective 1 February 2011

Discussion in 'Index Futures' started by Dogfish, Dec 13, 2010.

  1. Dogfish


    "New pricing model shall enhance market quality and encourage volume
    growth/ Fee reductions in index and equity derivatives will benefit
    end customers

    The international derivatives exchange Eurex will introduce a new
    pricing model, effective 1 February 2011. The overarching goal is to
    further increase the attractiveness of the Eurex marketplace by
    offering incentives for market quality and volume contribution as well
    as fee reductions in a number of key products.

    "The new pricing model is designed to further encourage volumes,
    enhance order book quality and attract new customers. Our new model
    will help fuel growth in trading volumes across key product segments,"
    said Andreas Preuss, CEO of Eurex.

    The enhancement of order book trading shall support market
    transparency and price discovery. To achieve this goal, the highest
    proportion of incentives will be given to market makers in exchange
    for providing value to the order book. Additionally, the two current
    market making schemes will be further differentiated to reward market
    makers according to their market quality contributions.

    Members who provide significant trading volume will benefit from
    modified rebate schemes for both futures and options products.

    The existing fee caps for block trades in options will be replaced by
    a staggered fee model. Additionally, proprietary traders will receive
    volume rebates that are valid for both order book and block trades.

    Furthermore, end customers will directly benefit from lower
    transactions fees for a number of key index options, single equity
    options and single stock futures. For example, transaction fees in DAX
    options will be reduced from 75 to 50 euro cents and fees for equity
    options will be reduced from 20 to 10 euro cents.

    Other measures under the new pricing model include the removal of the
    minimum quarterly transaction fee to lower entry barriers for new
    trading firms. Additionally, in the first quarter 2011 the contract
    sizes of selected single equity options and single stock futures will
    be increased to comply with international standards. As a result, the
    number of traded contracts is expected to decrease while fees in these
    products will become more attractive.

    On aggregate Eurex participants will benefit from approximately 20
    million euros in lower fees annually based on 2010 volume figures. Due
    to the expected growth in trading activity as result of the new
    pricing model, Eurex estimates a largely neutral effect on sales revenues.

    For further information please visit"
  2. syrre


    Very good and also needed.
  3. esmjb


    "Additionally, proprietary traders will receive
    volume rebates that are valid for both order book and block trades."

    I won't be holding my breath waiting for a rebate.