Derivatives exchange, Eurex US, launched currency futures trading with 20 market makers on 23 September. The market makers include global banks and proprietary trading firms with experience providing streaming two-way currency prices in the FX market.
Satish Nandapurkar, CEO of Eurex US, says: “We have established significant backing from market makers and we are delighted that this emerging asset class is already receiving such strong industry support. These firms recognise that there is an opportunity to trade exchange-traded FX futures on a liquid and transparent market at a cost comparable to the OTC market.”
Eurex’s move into FX futures marks the extension into a new asset class for the exchange. Initially, contracts in the six major USD currency pairs and four cross currency pairs will be offered. In addition to open and equal access, anonymity and low transaction fees, traders will also benefit from the US regulatory environment and 60/40 tax treatment. Contracts will be cleared by the Clearing Corporation.
Market makers are also eligible to take part in the FX revenue sharing programme – Eurex US has earmarked 40% of its FX revenues for this initiative. In addition, exchange fees will be waived through the end of 2005 with extended waivers for market makers.