Eurex enables global ESG investing
03 March 2020 London
Image: Shutterstock
The global derivatives exchange Eurex has expanded its environmental, social and governance (ESG) offering to a global level with the launch of new MSCI index-based derivatives.
The Deutsche Börse subsidiary is supporting asset managers in switching to sustainable investments by broadening its ESG segment and introducing sustainable versions of various regional and global benchmarks, as well as expanding its range of ESG derivatives to markets beyond Europe.
The institutional investors trading in MSCI index-based derivatives has nearly doubled within the past two years and now represents 27 percent of turnover.
Currently, 120 MSCI index-based futures and 20 MSCI index-based options are listed at Eurex. The total open interest is approximately 2.5 million contracts, which is the world's highest MSCI index-based derivative-related open interest, says the exchange.
Eurex says the new contracts complement its previous ESG offering which mainly focused on European markets. Launched in time for the next roll in March, the new contracts include ESG-screened versions of MSCI indexes covering the US, emerging markets, as well as Canada, Japan and elsewhere.
Michael Peters, a member of the Eurex executive board, says: “Our aim is to set the agenda in ESG and to offer investors the greatest possible flexibility in their global ESG investments.
“The new Eurex ESG futures reflect the growing demand for sustainable benchmarks on a global scale” adds Carolyn Weinberg, global head of products for exchange-traded funds and index investments at BlackRock.
“The transparency of sustainable indexing methodologies empowers financial markets participants to articulate their risk preferences,” she adds. “The extension into derivatives is significant as sustainable indices are used as financial instruments.”
The Deutsche Börse subsidiary is supporting asset managers in switching to sustainable investments by broadening its ESG segment and introducing sustainable versions of various regional and global benchmarks, as well as expanding its range of ESG derivatives to markets beyond Europe.
The institutional investors trading in MSCI index-based derivatives has nearly doubled within the past two years and now represents 27 percent of turnover.
Currently, 120 MSCI index-based futures and 20 MSCI index-based options are listed at Eurex. The total open interest is approximately 2.5 million contracts, which is the world's highest MSCI index-based derivative-related open interest, says the exchange.
Eurex says the new contracts complement its previous ESG offering which mainly focused on European markets. Launched in time for the next roll in March, the new contracts include ESG-screened versions of MSCI indexes covering the US, emerging markets, as well as Canada, Japan and elsewhere.
Michael Peters, a member of the Eurex executive board, says: “Our aim is to set the agenda in ESG and to offer investors the greatest possible flexibility in their global ESG investments.
“The new Eurex ESG futures reflect the growing demand for sustainable benchmarks on a global scale” adds Carolyn Weinberg, global head of products for exchange-traded funds and index investments at BlackRock.
“The transparency of sustainable indexing methodologies empowers financial markets participants to articulate their risk preferences,” she adds. “The extension into derivatives is significant as sustainable indices are used as financial instruments.”
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