Euronext launches Europe’s first weekly futures

Euronext has introduced a range of new derivatives contracts this week, providing investors with new hedging tools, including index futures with weekly expirations.

Euronext has introduced a range of new derivatives contracts this week, providing investors with new hedging tools, including index futures with weekly expirations.

The bourse has become Europe's first exchange to launch weekly expiry futures, with contracts based on its CAC40 and AEX indices in Paris and Amsterdam respectively. 

The shorter expiry will trade alongside traditional monthly and quarterly dates and are intended as a hedging tool through dividend season.

Weekly expiries were pioneered by CBOE in the US, but have not debuted in Europe until now.

The shorter expiration allows investors to react to short-term news or price movements.

The exchange group secured the backing of BNP Paribas and Société Générale in designing the products.

“This is a good example of how we want to drive growth in our derivatives franchise across Europe by being innovative and responding rapidly to client needs,” said Adam Rose, head of financial derivatives at Euronext.

The European group has also launched a series of spotlight options this week, which give more visibility to underlying assets such as medium and smaller sized companies and newly listed stocks.

These contracts also have short maturities, with one, two and three month options available.

Spotlight options have been launched on Euronext Amsterdam and Brussels at present in a bid to boost liquidity on the exchanges.

Euronext has said the options will be expanded to other geographies and asset classes in a second phase of the launch. 

“Spotlight Options will allow investors to enlarge their option portfolio in our transparent, regulated and cleared trading environment,” added Rose.

“This is another initiative from Euronext to diversify and build its derivative portfolio and offer attractive and innovative investment opportunities for its broad range of retail and institutional investors.”

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