Eurex to Expand its Commodity Index Derivatives Offering

Introduction of six more futures on Dow Jones UBS commodity indices on 28 June

The international derivatives exchange Eurex announced today that it will be introducing six additional commodity index futures on 28 June. The new futures are based on the Dow Jones UBS commodity index family’s sub-indices: softs, grain, precious metal, ex-energy, petroleum and livestock. They complement the futures listed since March 2009 based on the Dow Jones UBS composite index and the three sub-indices agriculture, energy and metal. The entire range of sub-indices of the Dow Jones UBS family will be covered by futures as from the start of trading.

“We are expanding our commodity index derivatives in response to our customers’ increased interest in exchange-traded index products in this asset class,” said Peter Reitz, member of the Eurex Executive Board. “Institutional investors are investing more and more in commodities for better portfolio diversification. Our cash-settled index futures are a safe and easy instrument for such investments.”

All new Eurex futures are based on the excess return version of the indices; they are denominated in US dollars and are settled in cash. They have quarterly expiration dates. Two market makers are responsible for liquidity in the order book and in OTC transactions.

Listed Eurex contracts are a good alternative to OTC swaps due to their low nominal value, high price transparency, easy settlement, and mitigation of counterparty risk. They enable better asset allocation within investment funds and cost-effective set-up of risk positions; they are also an efficient trading tool, for example, for long/short strategies.

Since the start of trading, more than 50,000 contracts have been traded in the four Dow Jones UBS index futures currently listed; open interest currently stands at just under 7,000 contracts.