Cboe Europe Derivatives (CEDX), Cboe’s pan-European equity derivatives market, today announced that Interactive Brokers has successfully joined the exchange as a participant and will provide its clients with access to CEDX’s range of equity index derivatives and equity options in the current quarter.
Interactive Brokers has become a direct trading participant on CEDX and a direct clearing participant for equity derivatives on Cboe Clear Europe NV, Cboe’s leading pan-European clearing house and CEDX clearing provider.
Iouri Saroukhanov, Head of European Derivatives, Cboe Europe, said:
“We are excited to welcome Interactive Brokers to CEDX, which represents a major milestone in the exchange’s journey to improve retail investors’ ability to access and profit from European derivatives, particularly options. Their participation demonstrates the need for more efficient European derivatives markets, which CEDX is helping to create by offering a simpler, lower-cost and pan-European approach to trading and clearing for lower barriers to entry for institutional and retail investors. Interactive Brokers has been a strong partner in successful US options markets for many years and we look forward to strengthening this partnership with them in Europe to help improve and grow derivatives markets in the region.”
Milan Galik, CEO of Interactive Brokers, said:
“We are delighted to introduce access to CEDX and give our clients an additional way to trade European derivatives alongside their existing global equities, options, futures, currencies, bonds, equities and more from a single platform . With the addition of CEDX’s extensive European equity options and index derivatives, our clients now enjoy enhanced choice and flexibility, enabling them to more effectively manage their European investments.”
CEDX launched in September 2021, initially offering trading in futures and options based on Cboe Europe single-country and pan-European benchmarks, with clearing provided by Cboe Clear Europe. NV The exchange is designed to promote on-screen liquidity and offers a single point of access to pan-European equity derivatives products, creating significant operational and capital efficiencies for participants.
CEDX expanded into equities in November 2023 and expanded the range of these products in Q1 2024. It now offers more than 300 options on companies from 14 countries (Austria, Belgium, Denmark, Finland, France, Germany, Ireland, Italy , the Netherlands, Norway, Spain, Sweden, Switzerland and the United Kingdom). These products account for more than 90% of current ADV and open interest in the top 600 European equity options as of April 2024.
To align with clients’ readiness to trade these products, CEDX launched its first Liquidity Provider Program (LP) for equity options on April 1, which also applies to index options contracts.
CEDX stock options are cleared by Cboe Clear Europe NV, which allows underlying stock to be used as collateral to provide hedges against matched stock option positions, providing a potential initial margin reduction for a covered call position of approximately 70%, according to with Cboe Clear Europe NV estimates In addition, stock settlement (upon option exercise and vesting) takes place in domestic Central Securities Depositories (CSDs), removing unnecessary costs and allowing settlement to be offset against related cash stock transactions.