The FINANCIAL -- Euronext, the primary exchange in the Eurozone, on June 1 announced the launch of three country indices: the Euronext Germany Index GR (ENDEG); the Euronext Italy Index (ENITI); and the Euronext Spain Index (ENESI). The indices will serve as the underlying for new index futures and index options, which will be available for trading in the third quarter of 2015.
The country indices are composed of the 30 companies with the highest free float market capitalisation listed on the main markets of the respective country, with a free float higher than 15% and a 12 month velocity score of 20 or more. The review of the composition and a capping of 20% for individual companies will take place annually in October with quarterly updates for the number of shares, according to Euronext.
In order to be able to offer investors greater transparency into the price performance of an index as well as the distributed dividends of the constituents, three different variants of the country indices will be published: a price return; a net return; and a gross return index. Price return indices do not take dividend payments into account, while gross return indices include the fully paid dividends. Net return indices include the paid dividends minus the applicable tax amount. Derivatives will be available on the price return variant of the Euronext Spain Index and the Euronext Italy Index and on the gross return variant of the Euronext Germany Index.
Michael Hodgson, Head of Information Services at Euronext, said: “As a pan-European exchange we are pleased to announce the launch of these new European country indices outside our traditional Euronext countries, and the subsequent roll-out of derivatives products. It will allow investors to gain insight in the current condition on European stock markets and enlarge their derivatives portfolio in their own familiar, transparent, regulated and cleared trading environment.With thislaunchwe are expanding our extensive offering of indices and derivatives illustratingour successful combined business approach and our efforts to launch products that respond to the market’s needs.”
Euronext offers a broad range of indices and derivatives. It manages and calculates 450 indices (third-party indices included) and offers 650 derivatives product classes. Index derivatives account for 46% of the total turnover in derivatives products on Euronext’s markets². The new options and futures on the country indices will further grow Euronext’s existing derivatives offering and build on last year’s launch of an enhanced stock futures franchise.