The international derivatives exchange Eurex will be launching derivativeson the MSCI Russia Index denominated in US dollars as of 23 June 2008.
This step extends the existing products on Russian underlyings which were introduced in April 2007. In addition, Eurex will add another equity option on OJSC Rosneft as of the same date.
“With this new index derivative, we can participate in the rapidly expanding Russian market. We are offering our clients attractive, cost-efficient and liquid investment and diversification opportunities in one of the most important emerging markets,” says Peter Reitz, member of the Eurex board.
This is also the first time Eurex offers derivatives based on MSCI indices. New York-based MSCI Barra is the index provider for international equity benchmarks.
“We are delighted to have licensed Eurex for the creation of derivativesbased on the MSCI International Equity Indices, starting with futures and options contracts on the MSCI Russia Index,” says David Brierwood, COO, MSCI Barra.
The MSCI Russia Index comprises the largest Russian companies by marketcapitalisation meeting certain minimum liquidity and free float screens,for companies incorporated in Russia with a listing in Russia, London or New York.
The weighting of the components is not capped. Currently it contains 32companies, and it is reviewed four times a year. Settlement of the indexfuture and index option will be made in cash, with one index point worth $25.00.
The future expires in March, June, September and December. Index options are offered with expirations up to 24 months.
In addition to the new index derivatives, Eurex will be listing a newoption on Russian stock OJSC Rosneft. The new contract comprises 100 shares, has a maximum maturity of 12 months and delivery will be physical. With this, the number of equity options on Russian underlyings available at Eurex will increase to five.
Additionally, Eurex offers trading in 19 Russian equity futures.