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Eurex Improve

Eurex Improve

Eurex Improve is a new matching functionality that provides our members with a tool to guarantee their customers full execution of trade quantities below minimum block trade sizes at the best available price at Eurex. Eurex Improve is fully compliant with the pre-trade transparency requirements stipulated in Art. 8 MiFIR.

Eurex Improve aims to attract additional customer flow to the exchange. 

Functioning

In line with Eurex’s principle of the order book being the most relevant and best suited execution mechanism to ensure fair and orderly markets, Eurex Improve is fully integrated in the order book. Eurex Improve matching events will be executed in a 3-step process:

Step 1: Initiation

Any trading member, facilitating customer flow, can submit an Improve request, consisting of a customer order and an opposing trading member order. The two orders are identical except for the buy/sell indicator. In particular both orders are for the same product, the same quantity and the same price. 
Full execution of the customer order is ensured at the determined price level, or better.  
The initiating trading member can also commit to trade at less favorable prices for themselves, to match prices offered by other market participants during the price improvement period (tolerable price concept).

Step 2: Price improvement period

Once an  Improve request has been submitted, Eurex informs all members of the imminent execution of the Improve request in form of the Improve announcement. In particular, the announcement will disclose to all market participants the product, the size and the price of the Improve request.
Directly after this announcement the price improvement period starts.
During the price improvement period, all members (except for the trader, who initiated the Improve request) can (try to) participate in the Improve execution, by submitting additional orders or quotes to the orderbook. 

Step 3: Execution

After the price improvement period, the opposing customer and trading member orders are executed in the orderbook in line with predefined matching rules. 
If no additional orders or quotes were provided during the price improvement period, the  trading member’s order automatically ensures full execution of the customer order. 
Partial executions of the customer or the trading member’s order at different price levels are possible. 
 

Benefits

Eurex Improve adds value to the overall market structure, by providing advantages to all involved stakeholders:

  • The customer is guaranteed full execution of their order at a predetermined price or better. The customer order is subject to price competition, providing the possibility that (part of) the order is executed at a more favorable price than initially determined with the initiating trading member.
  • Trading members are provided with a tool to generate additional customer flow, as they are able to ensure full execution of their customers’ orders at a predetermined price (or better). Trading members are rewarded for bringing additional customer flow to the exchange by receiving preferential participation rights in the execution of such customer flow.
  • Liquidity providers have the opportunity to engage with order-flow that otherwise might have been executed without their participation. Once an Improve request has been announced, execution of the customer order is guaranteed.  


Timeline

Eurex Improve is planned to be launched in February 2020 for all equity and equity index options and is already available in the T7 simulation environment. 

Contacts

Kirstin Meissner

T +44 207 8 62-72 55

Markus Schiller

T +49 69 2 11-1 41 31

Andrei Jitariu

T +44 207 8 62-72 14

 

Market Status

XEUR

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The trading system is currently experiencing technical issues

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