Eurex Clearing provides a wide range of position and transaction management services for the listed derivatives market, which facilitate back-office clearing and settlement processing, faster and flexibly.
Transaction Booking and Position Building
The position keeping of options and futures contracts enables Members to inquire their current positions, enter adjustments on transactions, and to enter adjustments to positions (position adjustments). Each transaction in the same contract, transaction account and with the same basket ID is booked into one position.
Transactions are only adjustable for a limited period (i.e., transaction adjustments are possible for T+5 days – also known as transaction duration). Positions are available for adjustments until expiration.
Transaction Management Functionalities
Members may split one transaction into several legs via transaction separation. Technically, the number of splits is unlimited, functionally it is naturally limited by the transaction quantity. All legs will carry the same original trade price.
Members may change the open/close flag for a specific transaction by performing an open/close adjustment.
Members can move transactions within their own transaction accounts. The re-booking of a transaction is possible on all accounts as transfers from and to P account are allowed only for error corrections.
Note that quotes are exceptions, which cannot be transferred via transaction account transfer.
The average pricing functionality allows the merging of multiple transactions into one with an average price calculated by Eurex Clearing. The price of the average price transaction is determined using a volume-weighted calculation and is rounded to seven digits. A residual amount representing the difference in cash flows can result from the calculation/rounding.
The creation of average priced transactions is available for transactions:
Average pricing is not available for:
The following trade types can only be merged with the same trade type
Members may execute subsequent adjustments to the merged transaction (e.g., trade separation, give-up/take-up).
Average priced transactions can be de-merged (i.e., the original transactions can be re-established). The following conditions must be met:
Eurex Clearing offers free text fields per transaction which can be edited. Members has the possibility to enter reference data for single and multiple trades.
The give-up functionality allows members to transfer transactions to other members, who respectively need to take-up the incoming transaction in order that the transfer is valid. Give-ups require also the approval of the corresponding Clearing Member. Clearing Members may specify auto-approval per participant for faster processing. The give-up Clearing Member can approve at any time (i.e., it can be the first, second, or third action in the process). The take-up Clearing Member can only approve after the take-up participant Exchange Member NCM has claimed the incoming transaction.
The following conditions must be met for a transaction to be given-up:
The initiating Member can cancel the give-up process if the status is still "pending". Transactions from cancelled or rejected give-ups remain in the account of the initiating Member.
Pending give-up processes are not cancelled during a booking cut (EOD processing) but will automatically be reallocated on the next business day if the conditions for a give-up (see above) are still fulfilled.
Transactions that are part of a pending give-up process cannot be further adjusted.
Eurex Clearing supports the Atlantis service (formerly known as eGAINS) from the FIA Technology Services. The Atlantis service is aimed to address inefficiencies in the brokerage, billing and payment process related to the processing of give-ups to allow for an electronic handling, reconciliation and break-management between executing and clearing brokers.
Eurex Clearing runs a near-time submission service of give-up and take-up related transaction data to the Atlantis system. To comply with data protection and privacy only give-up and take-up data where all involved parties have subscribed to the Atlantis service will be prepared for transmission to the Atlantis system.
In order to participate in this automated billing service, interested firms need to initiate an Atlantis agreement with the FIA Technology Service, Inc. Following this agreement between the participant and the FIA Technology Services, Inc., the members will be set up accordingly by Eurex Clearing.
Position Management Functionalities
To rectify erroneous open/close transaction designations, members can perform Position open/close adjustments to increase/reduce the open long and short position equally. Previously closed-out positions can be re-opened.
Note that the re-opening of positions is available for four business days.
Zero cost quantity (ZCQ)
A distinction is made between cost-free and fee-liable position closing adjustments.
Eurex Clearing offers also the possibility to transfer a position. It is distinguished between internal position transfers (transfers between the own accounts) and external position transfer (transfer to another member).
Internal position account transfer
Positions can be transferred (completely or partially) to a different account of the same member. Internal position transfers are executed immediately. Exercised or assigned positions cannot be transferred.
External position transfer (to another Clearing Member)
All external position transfers are immediate and can optionally carry a cash amount. When transferring a position, members have the choice to adjust the position transfer price and/ or to transfer a cash amount.
Exercised or assigned positions cannot be transferred.
Cash only transfer
Members can also use a position transfer request to transfer cash only. After the approval for external position transfers, the cash will be booked to the destination account with the next booking cut. Only cash amounts up to a Clearing House defined limit (defined per currency) can be transferred and only for a specific instrument.
Processing of external position transfers
Similar to the give-up/take-up for transactions, external position transfers require the approval/acceptance of the initiating and receiving member, as well as their respective Clearing Members. As long as the position transfer has not been approved by all the relevant parties, the transfer remains pending until the end-of-day processing or until the request is cancelled by the initiator or rejected/denied by one of the related parties.
Members are provided with automated exercise and assignment features.
The holder of a long option position may exercise his or her right to demand
American-style options can be exercised on each business day. European-style options can only be exercised on the last trading day.
Automatic exercise facility
Open long standard as well as flexible option positions may be automatically exercised on expiration day. Open positions are automatically exercised when the defined minimum in-the-money amount is met. A default minimum in-the-money amount is defined for all Eurex options.
Member may exclude individual positions (total or partial) from automatic exercise by using the abandon functionality.
The holder of a short option position may be assigned to fulfil their obligation
Eurex Clearing uses a random procedure to assign exercise notices to option seller from all open short positions of the same option series. Assignment is legally binding.
The holder of a short position in physically settled products (fixed-income futures contracts) may indicate their choice of “deliverable” from a basket by entering a delivery notification into the system on the expiry date.
The securities nominated in the delivery notification are randomly allocated to the holders of long position in physically settled products (during the overnight batch processing). Clearing Members are informed of the allocations on the same business day.
Entitlement and Availability
Entitlement is a mechanism to grant Members and their Users access to transaction and position management functionalities in the C7 clearing system. The entitlement model uses roles as a basis to allow an easier way to assign a group of activities (privileges) to a certain Member or user. The roles will be assigned to a Member and the Member’s Service Administrator can then assign the roles to the respective users. The roles contain privileges. Every privilege defines access to a specific activity (e.g., ‘Add Give-Up’). A request entered by a user can only be processed if the corresponding privilege is assigned for the user.
Eurex Clearing offers simplified outsourcing of back office functions via FIXML and via the C7 Derivatives Clearing GUI.
The simplified outsourcing mechanism is exclusively available for Clearing Members (CMs) insourcing back-office functions of their Disclosed Clients (DCs) and DC Market Participants. A user on the Clearing Member side can log into the GUI using his own Member ID/User ID and is allowed to initiate requests for transaction or position management out of the DC Market Participants position account.
In order to apply for simplified outsourcing, the Announcement of Outsourcing of Back-Office Functions of Eurex Clearing DC Market Participants can be requested via the respective forms.
Transactions are adjustable for a limited period of time, known as the transaction duration. During the transaction duration, adjustments are possible depending on the product phase in which the product is at that time. The following product phases are differentiated by the C7 system:
In the Clearing Phase, all clearing activities are allowed.
No Position Move Phase
This product phase allows all clearing activities, but restrict the transfer of quantity to other participants via Give-up or External Position Transfer.
No Settlement Phase
This product phase allows all clearing activities, but Exercise, Abandonment from Automatic Exercise or Notifications are not allowed.
Restricted Access Phase
When a product is in the phase Restricted Access, position and transaction management is not possible.
Please note that on the last trading day for some products different timings for the front month may apply. These different front month timings as well as intraday changes to the schedules are not covered in the CSV file. Time is given in CET/CEST in the CSV file.