Any information on this ? I cannot find the original post - however a) I strongly doubt Eurex will introduce Russell Futures. AFAIK the CME's license arrangement with Russel is exclusive, like with S&P b) I have doubt they can offer commodities in near future. The problem is, to offer physically settled contracts, the exch needs immense infrastructural preparations (contractors for settlement) which also needs great experience. One trader around here said, it would take Eurex 5 years to prepare for phys delivery. An alternative would be cash settled commodities, don't know if it has been done yet, but I doubt anyone would trade these because phys settlement is absolutely cruicial for oil & gold. Currencies, however, should be absolutely no problem. I think we will se a price war CME - Eurex here very soon. Maybe it'll even go down to zero for a longer time... CME however, would probably win with their better platform. Anyway, if EurexUS does not get any volume next year, I'd say they are out of the biz.
Take a look at this eurex us press release: Eurex Enters Broad Index Licensing Agreement with Russell Eurex global liquidity network to expand into U.S. equity index products/ Eurex and Russell to leverage benchmark success into futures liquidity/ Ferscha: Combination of U.S. benchmark indices and Eurex liquidity network creates new opportunities Mar 18 2004 The international derivatives market Eurex and the U.S. index provider Russell have signed today an agreement to license Russell indexes as the basis for index derivatives. The agreement covers the entire Russell index family, including the U.S. large cap index Russell 1000®, the U.S. small cap index Russell 2000® as well as the broad based Russell 3000® index and their respective growth and value indexes. Both Eurex and Eurex US are licensed under this agreement with initial listings anticipated on Eurex US. "This agreement marks the beginning of the expansion of the Eurex global liquidity network into U.S. equity index products. Combining Russellâs benchmark indexes and Eurexâs global liquidity network creates low cost trading and arbitrage opportunities on our global liquidity network,"said Rudolf Ferscha, CEO of Eurex. "We are in the unique position to offer our customers leading European and U.S. equity index derivatives on the same platform. Investors will benefit from the cheapest way to equitize cash positions." Eurex has developed its share in the European equity index market from below 50 percent in 2000 to over 70 percent in 2003, which offers prime opportunities for arbitrage, cross product spreads and capital savings. "Eurex Russell futures will provide the continuously growing number of investors using Russell indexes with an excellent portfolio risk management tool" said Kelly Haughton, Strategic Director, Russell Indexes. "These users will benefit from Eurexâs low cost equal access market model and global distribution." The Russell index family currently consists of 22 indexes. All 22 indexes are free float market cap-weighted and subsets of the Russell 3000 Index which represents approximately 98 percent of the U.S. equity market.
I really did not get this. Just wondering it is over 1/2 yr old and nothing happened. Any news out - approvals / CFTC / FSA ? But let's hope Eurex platform improvements (they plan to take the "quotes netting" from CEF feed by end of october) are effective, because the current feed in conjunction with a high-speed product like the ER2 would be problematic.
sas, Read my earlier post. Eurex USA is well thought out and they are on there own timeframe. It was planned to start slow and build. That is what you are seeing. Yes, Eurex and Eurex USA are going to some kinda faster/better connections?? I am not techie so I do not know if I worded it correctly. But they have everything laid out. Worst case scenario, it will make it cheaper for us to trade at the CME. Although, from what I know Eurex USA. They might just serve up the CME. Who knows. I love the ER2. It has become my favorite equity product. The problem is I cannot move the kind of size as easily as I would like to. Hopefully, Eurex USA will bring the Eurostoxx type sick ass size to the ER2!! Or better yet the Russell 1000 (close beta of the spoo)! We will see. The institutions are soooo pissed at the Merc over historical grievences (alot of traders I know are as well). It will get interesting. The CME does not have near the customer loyalty as the Cbot. Believe me. Institutions and traders did not leave the Cbot to save a few cents. On the other hand, they will line up to leave the Merc to save a pennie!!! Just watch....
Just a couple of things on this subject. I'm a Eurex trader and have been watching Eurex US for a while now in search for the next market. The Russell is coming to eurexus soon. I am consistently in direct contact with the managers here in Chicago and check up with them every other week. er2 is definitely coming to eurexus and it will have the same tick size and value as the CME. There will likely be incentives to trade it for the first couple of months. I am definitely planning to hammer on that thing when it starts (assuming the liquidity is there). As far as Exchange fees, the best I could get out of them is that the fee will be competitive with the member fee at the CME without having to buy membership and become one of the boys (like at the CME). By the way, the CME is offering what is called Rule 106.r. This allows a corporation that trades its own funds to trade most CME Globex products for 44 cents per side. Any corporation can apply. I don't have the full details yet, but this may be an option for those who are active in the Eminis, Eurodollar, etc. Setting up a corporation is not much more than $300 and there are some tax/liability advantages to trading another a corp. Speak to your accountant. If you are active, you will want to consider this option. As far as, the bonds are concerned. It looks to me like the volume is picking up but the book shows it as if it is all being traded by machines to match the CBOT contracts. It is a great trade if you are trading bonds on CBOT and are paying out the nose. Now you can access US interest rate products without paying non-member rates. The incentive programs are great for members. Cheers and good luck this coming week.
The 106r deal from the CME is all electronic products only. That's .44/side exchange fees or .88 RT...this is a HUGE reduction for currency (Euro) 6E traders with the non-member exchange fees at $3.20. The only products that are electronic and more than .88/RT are the large SP contracts traded electronically...they are .88/side. It will be very interesting to see the ER2 come under competition. JAy
That's right. Like I said, this only applies to Globex mini products. If a trader is doing enough volume and can't afford the $175,000 IOM membership seat cost, then this is definitely the way to go.
Haven't checked Eurex US volume figures recently but I think they are not what they used to be a month or two ago. I would not concede victory to the CBOT yet, but it is close. Some fund the other day unloaded about 150k ten year notes on the screen at the CBOT, they would have been raped on Eurex US.
Well.... I wish they would get the ER2 on there soon. I would definitely pay more attention. I am a member of EurexUS and have been trying to participate in the incentive program (got an X-Box so far but no $$$). It would be awesome if the added the ER2 and included it with no fees and on the same program as the bonds as far as sharing profits with those doing volume. I would hit that thing with 1000 roundturns a day if the volatility and liquidity are there.