TAIFEX, a Taiwan futures exchange, has entered into a deal with Germany’s Eurex Exchange, offering Europe-based traders the ability to clear Taiwanese derivatives products. The partnership between Deutsche Börse-owned Eurex, one of the largest derivatives market, and TAIFEX through a letter of intent, according to The Trade.
Eurex intends to list TAIEX options and futures on its platform from Q4 2013, subject to regulatory approval. According to The Trade, the companies are hoping the link will stimulate liquidity, improving efficiency of trading Taiwanese derivatives. The TAIFEX and Eurex Partnership is the first major link established by the Taiwanese market operator and the country’s market regulator. In listing products on Eurex, TAIEX options and futures can be traded after the local market shuts down.
This is the first time TAIFEX options have the opportunity to be traded during U.S. and European market hours. At the end of each trading day at Eurex, the open interest will be transferred to the TAIFEX clearing house. The Trade states that TAIEX options last month reached an average daily volume of over 500,000 contacts compared to 100,000 for TAIFEX.
In a quote obtained by The Trade, Eurex CEO Andreas Preuss stated: “This cooperation is a major milestone of our Asia strategy to broaden our global product suite,” adding that, “Our members will benefit from direct access to one of the most successful derivatives contracts in Asia, while Taiwanese market participants will have the opportunity to trade Taiwan’s most liquid index derivatives contracts during Taiwanese after hours. The cooperation also aims to attract new Eurex customers for TAIEX products outside of Taiwan and increase the interest for Eurex products from Asia-Pacific.”