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Eurex Annual Derivatives Forum: meeting market requirements with innovation

Release date: 26 Sep 2017 | Eurex Exchange

Eurex Annual Derivatives Forum: meeting market requirements with innovation

Over 120 representatives from the buy and sell side attended this year’s Eurex Derivatives Forum at the Intercontinental Hotel in Frankfurt. Both the agenda and the invited guest speakers made for an informative afternoon.

The event kicked off with a welcome speech by Michael Peters, Deputy CEO of Eurex, who talked about the necessity of getting the EU back on track, challenges arising from the uncertain market situation and the importance of meeting these requirements through innovative solutions. In the following keynote speech, David Milleker, Chief Economist at Union Investment, addressed the macroeconomic situation in Europe and thus paved the way for the ensuing panel discussion entitled “Interest yields and the end of quantitative easing”.

The high-profile panel of industry experts agreed that the interest rate level is likely to remain low, entailing all the familiar effects on the bond market. There is, however, a remedy: the Corporate Bond Index Future, a new asset class introduced by Eurex, is the first listed futures contract on a European corporate bond index. The contract was developed in collaboration with STOXX and is based on the EURO STOXX 50® Index. It is, amongst others, a flexible hedging instrument for the buy and sell side.

A further Eurex innovation was presented by Randolf Roth, Member of the Executive Board of Eurex: an RFQ platform, initially for fixed-income options, which transfers the pricing mechanism for large and complex orders – traditionally a phone transaction – to electronic trading. Amongst other things, the new platform will help customers meet the best execution requirements in compliance with MiFID II as of December 2017. Another highlight was the second, extremely practical keynote speech of the afternoon, delivered by Thomas Richter, Managing Director, BVI (the German Investment Funds Association). He explained how the BVI safeguards German buy-side interests worldwide.

During the following panel discussion “Brexit and euro clearing”, the experts agreed that Brexit negotiations will most likely continue to proceed at a slow pace, which means that the uncertain situation for customers will remain. A hard Brexit, although undesirable, is becoming ever more likely. Matthias Graulich, Chief Strategy Officer, Eurex Clearing, and Burkhard Rinne, Partner, Linklaters, discussed the possible effects of this development on the markets. The discussion was moderated by Markus Röhrig, Partner, McKinsey.

The afternoon was concluded with a final panel discussion on the topic “Will innovations in listed derivatives serve to drive growth?” Nicolas Kageneck, Eurex, moderated the lively debate on futurization and total return futures.