Eurex US, the fully-electronic U.S. futures and options exchange, announced today that the exchange would make modifications to its wholesale trading facility effective August 16. These modifications are designed to stimulate trading activity in over-the-counter (OTC) wholesale trades on the exchange and to further increase the diversity of trading on Eurex US. The Eurex US wholesale trading facility enables institutional end users greater flexibility in executing treasury futures transactions.
Wholesale transactions at Eurex US provide qualified participants the convenience of negotiating a large transaction at a single price with a designated and appropriate counterparty, the security of a trade cleared by The Clearing Corporation, and the implementation of exchange rules and regulations, leveraging the convenience and efficiency of electronic straight through processing and reporting via the Eurex system.
Effective August 16, new thresholds will apply for the minimum number of contracts required for a trade to qualify as a wholesale trade. For futures on the 2,5, and 10 year Treasury Notes the minimum size will be 1000 contracts and for futures on the 30 year U.S. Treasury Bonds the minimum size will be 500 contracts. These changes will apply for trading during core U.S. trading hours (07:20 am to 02:00 pm CST). Outside these hours, the minimum size for wholesale trades will be 250 contracts for all of the above products. These modifications are the result of extensive discussions with market participants to ensure that Eurex US wholesale trading practices best serve customers' needs.
"With these wholesale trading modifications we are aiming to further diversify the source of open interest on Eurex US," said Satish Nandapurkar, CEO of Eurex US. "Simultaneously with our successful revenue sharing initiative focusing on proprietary trading, we are diversifying our order flow by further enhancing institutional end user interest with a more flexible wholesale trading facility. These modifications will continue to connect the cash, exchange-traded derivative, and OTC space in the U.S. Treasury markets globally."
Eurex US began trading on February 8, 2004 and currently lists futures and options on 2-, 5- and 10-year Treasury Notes and on 30-year Treasury Bonds. Trading volume on Eurex US reached an all time high of 673,180 contracts in July , an increase of 1000 percent on the June figure. Daily average volume traded on Eurex US has risen to over 48,000 contracts, up from 2,768 contracts in June.