The four new contracts will be traded on LIFFE CONNECT®, making trading in the new index derivatives possible from over 600 locations in 26 countries, and will be cleared through the London Clearing House. Over 560,000 transactions a day of equity index derivatives are already traded on LIFFE CONNECT®, making it an ideal centre of liquidity in which to trade the FTSEurofirst.
The FTSEurofirst Series is the new generation of tradable European indices designed by FTSE Group and Euronext. The FTSEurofirst 80 represents the performance of the Eurozone and the FTSEurofirst 100 represents the performance of the Eurozone and the UK. The pan-European indices were launched on 29 April 2003.
Hugh Freedberg, Chief Executive at Euronext.liffe said, "We are launching the new futures and options contracts because our customers want an index product which offers better coverage and sector representation than existing index sets with better correlation and index tracking. The beauty of the FTSEurofirst products is the liquidity of the underlying stocks in the indices, and their strong correlation with the broader European benchmark indices, creating the ideal basis for derivatives contracts."
Mark Makepeace, FTSE's Chief Executive added, "Market consultation showed a real need for an alternative to the currently available tradable pan-European indices. The FTSEurofirst indices offer the widest Euro and pan-European coverage giving traders the ease of access they need at a low cost. In addition the liquidity in the underlying shares allows customers to use derivatives with the cash components of their portfolios."
The exchange transaction fee will be competitively priced compared to fees customers are currently being charged. The standard Euronext.liffe transaction fee for the new contracts will be 15 pence per lot and the LCH fee of 3 pence per lot will be waived until the end of this year for all contracts traded. The futures and options contracts will also be supported by designated market maker and liquidity provider schemes.
