Eurex ponders improvements in light of Cboe Flex option debut
In a move that could shake up the European derivatives market, Cboe Europe Derivatives has announced plans to launch FLEX Options in Q1 2026. This expansion extends a US product they pioneered back in 1993.
The new offering will initially list on a select set of Cboe equity indices, single stocks, and ETFs, with plans to expand the market further throughout 2026. This move directly challenges Eurex's long-running "flexible contract" facility, which has been operational since 2005.
According to Iouri Saroukhanov, head of European derivatives at Cboe Europe, the launch of FLEX options in Europe is an exciting development. FLEX options offer OTC-like customisation with exchange transparency and central clearing, aiming to lower counterparty, operational, and capital costs compared to bilateral deals.
Cboe reported a significant increase in FLEX options trading in the US market. In 2025, 35 million FLEX options were traded on Cboe, compared to 2 million in 2019. These options allow traders to negotiate key contract terms within the safety of an exchange rulebook and central clearing.
The BIS reports that the OTC European equity-options gross market value was US$50 billion at the end of 2024, while for US equity OTC options, the figure was US$279 billion GMV. FLEX options offer the advantage of maintaining the OTC-like customisation while also providing the benefits of exchange transparency and central clearing.
All trades will clear at Cboe Clear Europe, its pan-European central counterparty (CCP). The go-live for Cboe's FLEX options is targeted for Q1 2026.
Eurex, a major player in the European derivatives market, has not provided a comment on the value of its own FLEX open interest. However, the exchange has reported increased volumes in FLEX options, especially in the single equity space. Eurex is also reportedly exploring options to further enhance its flexible derivatives offering.
As of 15 September, 7.87 million flexible contracts were traded at Eurex year-to-date. The BIS reports that OTC derivative gross market value is reported by dealers to the BIS at replacement cost, making a like-for-like comparison with listed derivatives difficult. If the 3% flexible contract share of option volume were extended to open interest, it would imply about US$11.8 billion in flexible-contract OI.
Cboe announced the plan at its risk management conference in Munich. The launch of FLEX Options in Europe marks a significant step in the evolution of the derivatives market, offering traders a new level of flexibility and cost savings.
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