Eurex/KRX Link

In cooperation with the Korea Exchange Inc (KRX), Eurex will provide Eurex Members and their customers with access to trading and hedging opportunities in KOSPI 200 Options, the most heavily traded options contract worldwide, and to the important Asian time zone. This offering will provide existing KRX and Eurex market participants the ability to adjust their portfolios after Korean trading hours.

As of August 30, 2010, Eurex will list daily futures on the KOSPI 200 Option (the "Eurex KOSPI Product"). The product will be set up and traded as a futures-style option in the Eurex® system. Legally it will be a futures contract which will expire daily into a KOSPI 200 Option position at KRX prior to the KRX market opening. Technically, however, the product will be set up and traded as an option. The KOSPI 200 Option listed on KRX will legally be the underlying for the Eurex KOSPI Product, although technically, the underlying (option series) will actually be traded itself.

Eurex Clearing AG will calculate a daily profit/loss based on the difference between the traded and settlement price (variation margin). Resulting cash flows will be paid/received in Korean Won (KRW). Therefore, Korean Won will be integrated into the existing cash processing/reporting structure of Eurex Clearing.

Settlement information will be transferred from Eurex Clearing to KRX at the end of each Eurex trading day. KRX will transfer the settlement information to the respective KRX member for entry of the respective KOSPI 200 Options into the KRX system via the OTC block trade functionality at KRX prior to the market opening at KRX. Therefore, all open interest in the KOSPI 200 Options will be consolidated at KRX.