The new development builds on an existing relationship between the two firms, leveraging their combined expertise to develop new derivatives products. This could potentially start with cash-settled index options tied to the FTSE Bitcoin Index and the FTSE Ethereum Index.

As part of the collaboration, Cboe plans to list cash-settled index options on FTSE’s indices – subject to regulatory approvals – which will target increased investor demand for exchange-traded derivatives to manage crypto exposure in a US-regulated trading environment.

“Our expanded relationship today mirrors that successful model of collaboration, combining Cboe’s unrivalled derivatives expertise with FTSE’s world-class indexing capabilities to potentially bring new solutions to the digital assets space,” said Catherine Clay, global head of derivatives at Cboe.

“[…] As these two asset classes converge, we look forward to driving continued innovation and our relationship with FTSE Russell will be key to this strategy.”

The FTSE Bitcoin Index and FTSE Ethereum Index are part of the FTSE Digital Asset Indices series, developed in partnership with Digital Asset Research (DAR).

These indices capture the performance of bitcoin and ether, as determined by the FTSE DAR Reference Price, offering exposure to the digital asset market.

“We are delighted to continue working alongside Cboe Global Markets, realising our mutual commitment to enable new asset innovation in financial markets,” said Fiona Bassett, chief executive of FTSE Russell.

“Our indices are used by some of the largest crypto asset managers in the world for their best-in-class data and processes built to manage regulatory and trading risk – critical differentiators for the data in this asset class.”

Cboe added in a statement that it plans to share more details about its intentions for cash-settled index options on the FTSE Bitcoin Index and the FTSE Ethereum Index potentially later this year.

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Lisa Schirf

As seen with existing Tradeweb FTSE closing prices for UK gilts and European government bonds, the new US Treasury closing prices will incorporate trading activity from Tradeweb’s electronic platform, which the firm claims to result in more robust benchmark pricing.

The new closing prices facilitate the calculation of bid and offer prices, capturing transaction costs based on executable pricing quotes collected via the Tradeweb platform. This builds on top of mid prices, which are produced for all asset classes.

The pricing data set features coverage of various of security types including US Treasury notes and bonds, bills, strips and Treasury Inflation-Protected Securities (TIPS), with both a 15:00 and 16:00 New York snap time.

“As we continue to expand Tradeweb’s collaboration with FTSE Russell, our clients gain access to a broader set of benchmarks for use as reliable closing prices in their investment process and end-of-day trading strategies and other purposes,” said Lisa Schirf, global head of data and analytics at Tradeweb.

“We believe the Tradeweb FTSE US Treasury closing prices will serve as a unique foundation for the global fixed income markets and their launch further demonstrates our commitment to the electronification of the markets.”

The extension of closing pricing to the US Treasury market will help expand benchmark pricing capabilities across a range of fixed income securities. Namely, USB-denominated credit securities will be included, which are largely underpinned by US Treasury valuations.

The new methodology is expected to be incorporation into UK gilt and Euro government closing prices, including the addition of bid and offer prices.

 “The launch of Tradeweb FTSE benchmark pricing for the US Treasury markets, represents significant progress in realising our ambition to offer the financial markets a better, more representative solution for valuing fixed income securities,” said Scott Harman, head of FICC indices at FTSE Russell.

“We recognise the criticality of the US Treasury markets to the investment ecosystem, and the need to continue to offer innovative benchmark solutions to our clients for this important asset class.”

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The pair aim to offer improved pricing across a wider range of fixed income securities, which FTSE Russell will administer as benchmarks.

This will build upon their existing collaboration on benchmark pricing for UK gilt and European government bonds, with the goal of delivering robust, algorithmic and reliable pricing.

Tradeweb’s trading activity from its electronic platform will be amalgamated by the closing prices, enabling closer alignment with actual trading levels and intraday pricing.

These prices are administered in accordance with the EU and UK Benchmark Regulation and the IOSCO Principles for Financial Benchmarks. They can be used as reference rates for a wide range of use cases including trade-at-close transactions and derivatives contracts.

“Tradeweb’s collaboration with FTSE Russell will provide clients with verified benchmarks they can use as reliable closing prices for their end-of-day trading strategies and other purposes,” said Lisa Schirf, global head of data and analytics at Tradeweb.

“The Tradeweb FTSE closing prices will create a foundation across global fixed income markets for consistent end-of-day and intraday prices and is another way we are investing in the electronification of the markets.”

Elsewhere, Tradeweb and FTSE Russell will work collaboratively on fixed income pricing sets to extend coverage across various regions and fixed income asset classes.

FTSE Russell will explore incorporating Tradeweb pricing into FTSE fixed income indices over time, initially with FTSE World Government Bond Index (WGBI), an index consisting of sovereign debt from more than 20 countries and denominated in a selection of currencies.

Tradeweb also plans to expand and strengthen electronic trading functionality for FTSE Russell fixed income indices and customised baskets through tools and protocols including request-for-quote (RFS), Automated Intelligent Execution tool (AiEX) and portfolio trading, providing trade-at-market close, trade-at-month-end and other features linked to index rebalancing trades.

Providing enhanced trading functionality will be able to help clients seeking to express a view on FTSE Russell indices and baskets manage what are typically their largest and most critical trades.

“With our comprehensive suite of sophisticated fixed income indices and a growing need for innovative pricing solutions from our clients, our deeper collaboration with Tradeweb will enable us to bring to market greater tractability and tradability of our indices,” said Scott Harman, head of fixed income indices at FTSE Russell.

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The Tradeweb FTSE Euro Government Bond Closing Prices will be calculated in accordance with the EU benchmark regulation. Tradeweb will be the calculation agent – using data from its dealer-to-dealer trading platform – and FTSE Russell will be the benchmark administrator.

The closing prices will follow the same calculation process as Tradeweb’s UK gilts benchmark regulation prices.

“With bond indices, ETFs and trade-at-close strategies becoming more and more integral to fixed income markets, the need for reliable and transparent closing price data has never been greater,” said Enrico Bruni, head of Europe and Asia business at Tradeweb.

“FTSE Russell is a global leader in benchmarking and we look forward to extending our successful collaboration to other global markets going forward.”

The prices will be available on Tradeweb and across Euro-denominated nominal bonds issued by Austria, Belgium, Finland, European Union, France, Germany, Greece, Ireland, Italy, Netherlands, Portugal and Spain.

“Having a robust and transparent methodology, that is administered according to IOSCO Principles for Financial Benchmarks, is core to providing credible reference pricing,” said Scott Harman, global head of fixed income and multi-asset indices at FTSE Russell.

“As a leading electronic trading platform for European government bonds, Tradeweb has a strong understanding of these markets and the important role this data plays across bonds, ETFs and indices.”

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According to an update on his social media, Norbert van Veldhuizen joined LSEG’s FTSE Russell this month after serving at BlackRock for almost 14 years, most recently as its director of index equity strategies for six years.

Prior to his most recent role, van Veldhuizen served across various institutional sales roles including director of institutional client service management and director of institutional sales at the asset management giant.

He began his career at independent wealth management firm, Van Lanschot Bankiers, where he served as an investment advisor for just over three years.

“I’m excited to join FTSE Russell, an LSEG Business, as head of equity index product, EMEA. I will be working within the Data and Analytics division of London Stock Exchange Group delivering data-driven insights, indices and products to clients,” he said in his social media update.

His appointment follows the departure of the former group head of investment solutions and chief executive of FTSE Russell, Waqas Samad, who left exchange in June earlier this year to pursue another opportunity after overseeing both investment solutions and the FTSE Russell business for the last two years.

Two senior executives, Lea Carty and Arne Staal, were appointed head of investment solutions, and group head of indices and benchmarks including FTSE Russell, respectively, in March to replace Samad ahead of his departure.

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The pair said the launch of the new derivatives offering was in response to market demand as investors globally are increasingly looking to dividend and total return-oriented UK stocks as an area of growth.

“We are delighted to work closely with Eurex in meeting growing investor demand for risk management products on the widely used FTSE 100 benchmark index,” said Waqas Samad, chief executive of FTSE Russell and head of investment solutions at LSEG.

“Our collaboration with Eurex reflects LSEG’s commitment to supporting clients across the markets and communities that we serve, the strength of the FTSE Russell index franchise and the ability of Eurex to meet client needs with innovative solutions.”

The partnership will see futures listed on the FTSE 100 total return index, the FTSE 100 declared dividend index contract, and futures and options on the FTSE 100 Index contract.

“Increased margin pressure, capital requirements and demand for electronic execution are moving OTC segments into futurised listed derivatives. Our innovative TRF offering provides great benefits to address these topics,” said Michael Peters, chief executive of Eurex.

This is the second partnership struck by FTSE Russell with an exchange to launch a derivatives offering this year so far.

In January, FTSE Russell launched a suite of environmental social and corporate governance (ESG) derivatives contracts with the Singapore Exchange (SGX) following a major partnership set up in August.

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The launch is comprised of four new ESG index futures as part of SGX’s Future in Reshaping Sustainability Agenda (FIRST) sustainability agenda which it launched in December. 

The new derivatives include SGX FTSE emerging ESG index futures, SGX FTSE emerging Asia ESG index futures, SGX FTSE Asia ex Japan ESG index futures, and SGX FTSE Blossom Japan index futures.

“Our leadership in developing a pan-Asia shelf of benchmark equity derivatives has placed us in a distinct position to drive the change the world needs to see today,” said Michael Syn, head of equities at SGX. “Together with FTSE Russell’s strengths in investable multi-asset products and ESG, our offering of sustainable risk-management solutions in Asia is unrivalled.”

The launch follows a major partnership between SGX and FTSE Russell in August when the pair agreed to develop a multi-asset index derivatives offering focused on Asian and emerging markets, as well as ESG and listed real estate index derivatives.

ESG has been at the centre of several market initiatives by trading venues recently as the market looks to ways that it can adapt to more a sustainable equilibrium.

Cboe and LCH launched ESG index options in summer last year, followed by the European exchange Deutsche Börse which expanded its ESG data and analytics offering with the acquisition of Institutional Shareholder Services (ISS) in November.

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The new futures mark an extension of the long-standing clearing relationship between SGX and CME Group after establishing their mutual offset system (MOS) for clients to trade and clear Asia and US derivatives markets in 1984.

“This [expansion] will enhance our offering in terms of providing our mutual customers the platform to manage their overnight risks in an effective and timely manner, and giving them greater access to the combined liquidity of both SGX and CME Group in a single marketplace,” said Tim McCourt, global head of equity index and alternative investment products at CME Group. 

Three net total return (NTR) futures contracts, SGX FTSE Emerging Market NTR (USD) index futures, SGX FTSE Japan NTR (USD) index futures, and SGX FTSE New Zealand NTR (USD) index futures, will launch on 23 November. 

The remaining two price return contracts, SGX FTSE Emerging Market (USD) index futures and SGX FTSE China H50 (USD) index futures will launch at the same time and become available on MOS in the first half of next year.

News of the derivatives’ launch follows confirmation in August that SGX and the London Stock Exchange Group’s FTSE Russell’s had entered into a long- term strategic partnership to develop a multi-asset index derivatives offering focused on Asian and emerging markets.

“This collaboration will enhance global access for investors wishing to the trade and clear Asian equity derivatives outside of the region and bolster liquidity across products,” said Waqas Samad, FTSE Russell chief executive. “Working closely with SGX, the addition of five new index futures contracts reflects our joint commitment to meeting investor demand for equity derivative and options trading as well as ETFs across Asia Pacific.

“As highly liquid multi-asset derivatives exchanges, both SGX and CME Group continue to play an important role in the creation of global risk management products centred on FTSE Russell index futures.” 

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In a statement, both institutions confirmed that the strategic partnership will initially develop index derivatives on Asian and emerging markets single country and regional equity derivatives, as well as ESG and listed real estate index derivatives.

“Together with FTSE Russell, we have built one of the largest and most liquid FTSE equity index derivatives franchises for Asian markets,” said Loh Boon Chye, SGX chief executive.

“With this expanded agreement with FTSE Russell, we will develop more unique tools to match evolving investor needs. FTSE Russell’s leadership in the world of investable multi-asset products and ESG, together with SGX’s leading position and unrivalled capabilities in Asian derivatives, will drive even greater impact and value creation for our customers.”

Both institutions added that they will work together on global marketing, product research, and client adoption of the new derivatives, and collaborate in product and platform development between their information services divisions.

“We are delighted to expand our successful relationship with SGX with this new strategic partnership, which will help support growing client and investment demand across Asia for access to index-based listed futures and options markets as well as ETFs,” said FTSE Russell chief executive, Waqas Samad.

“We also look forward to partnering with SGX to develop a range of index-based products to support the increasing need for sustainable investment solutions developed to globally recognised ESG standards, providing investors with further choice, diversification, and risk management opportunities for their portfolios.”

The latest partnership expands on the existing FTSE offering on SGX, including index futures on the FTSE China A50 index and the local partnership index, FTSE Straits Times Index (STI). Earlier this month, SGX also confirmed plans to launch Asia’s first international REIT futures based on the FTSE EPRA Nareit Asia ex-Japan index, and various other emerging markets Asia regional and single country futures based on FTSE Russell indices.

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The London Stock Exchange Group’s FTSE Russell has expanded its long-standing partnership with the Johannesburg Stock Exchange (JSE) to launch a series of co-branded of fixed income indices.

As part of the agreement, FTSE Russell will act as the benchmark administrator for JSE’s fixed income indices and provide daily index calculations on the FTSE/JSE All Bond Index Series, as well as the FTSE/JSE Inflation-Linked Index Series.

The new indices represent the performance of South African government, state-owned and corporate bonds, which both parties said offer investors multi-asset capabilities across South African capital markets.

“FTSE Russell aims to be the world leader in multi-asset indexing and now, domestic and overseas investors in local South African debt are able to benefit from FTSE Russell’s robust, transparent and objective approach to managing fixed income benchmarks,” said Waqas Samad, group director of information services at LSEG, and CEO of FTSE Russell.

FTSE Russell and JSE have been working together on providing equity indices since 2002, and agreed to branch out into fixed income indices in 2017. The partnership combines JSE’s regional expertise with FTSE Russell’s governance framework to provide objective investment services.

“Our partnership with FTSE Russell has seen local and foreign investors in stocks listed on our markets benefit from the expertise of an independent global index provider for almost twenty years. Today’s launch extends these benefits to corporate and government bond investors and will improve international access to our debt markets,” added Dr Leila Fourie, CEO of JSE.

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