single stock futures: taking advantage of european experience
DESCRIPTION
SINGLE STOCK FUTURES: TAKING ADVANTAGE OF EUROPEAN EXPERIENCE. Single Stock Futures : Taking advantage of European Experience. In most cases in Europe, Equity derivatives and Futures have been traded, cleared and regulated by the same actors. - PowerPoint PPT PresentationTRANSCRIPT
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SINGLE STOCK FUTURES:
TAKING ADVANTAGE OF
EUROPEAN EXPERIENCE
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Single Stock Futures :Taking advantage of European Experience
In most cases in Europe, Equity
derivatives and Futures have
been traded, cleared and
regulated by the same actors.
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Equity Futures are already
traded and cleared in Europe
on:
• MEFF (Spain)
• LIFFE (UK)
Single Stock Futures :Taking advantage of European Experience
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Cross margining of Index,
Equity Options and Stocks has
been available for years in
Europe (Euronext/France)
Single Stock Futures :Taking advantage of European Experience
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Some European initiatives to
integrate different Cash and
Derivatives businesses :
• Eurex Equity CCP
• Clearnet SA Cash & Derivatives
Single Stock Futures :Taking advantage of European Experience
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Europe went through major steps :
1. Regulatory environment
2. Settlement system openness
Single Stock Futures :Taking advantage of European Experience
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Regulatory environment
• Only one regulatory body for cash and derivatives
• Different asset classes in one single customer
account
• One single margin method for different asset
classes (Span, Tims, Rbm, etc)
Single Stock Futures :Taking advantage of European Experience
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Settlement system openness
• Seamless communication between settlement
systems (Futures, Equity, etc)
• Database repository containing different asset classes
• Ability to perform portfolio based margin across
different asset classes
Single Stock Futures :Taking advantage of European Experience
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Single Stock Futures :Taking advantage of European Experience
Futu
res
Secu
riti
es
Repos
OTC
(SW
,Fra
)Margin Engine Margin Engine
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Single Stock Futures :Taking advantage of European Experience
CME / GSCC
Euronext Cash / Deriv.
Eurex CCP
Margin EngineMargin Engine
TIMS
RBM
SPAN
Margin Methods Margin Rules
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Trading & Book
Keeping Systems
FuturesFutures SecuritiesSecurities BondsBonds
Margin EngineMargin Engine
Collateral Allocator
Fees & Commissions
Interest Calculator
LedgerLedgerCash
Management
CashManagement
CreditApplication
CreditApplication
SecuritiesManagement
SecuritiesManagement
RiskArrays
RiskArrays
MarketData
MarketData
Reference DataMethods
Risk Parameters
Reference DataMethods
Risk Parameters
TransientDATA
TransientDATA
Risk Positions (F&O, Bonds, Equities, Repos, …)
OTCsOTCs
Single Stock Futures :Taking advantage of European Experience
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European experience demonstrates
that Single Stock Futures initiative built
a bridge between Cash and Derivatives
and that software suppliers were
among the bridge builders.
Single Stock Futures :Taking advantage of European Experience