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World Federation Of Exchanges Publishes Annual IOMA Derivatives Report - Volumes In 2016 Grew By 2.2% To Reach 24.9 Billion Derivatives Contracts

Date 20/04/2017

The World Federation of Exchanges (“WFE”), which represents more than 200 market infrastructure providers including exchanges and CCPs, has today published its annual report into the global derivatives market.

Highlights of the report are as follows:

  • Derivatives volumes continued to grow in 2016 - increasing by 2.2% on 2015 - reaching a total number of 24.9 billion derivatives contracts.
  • This was made up of 9.4 billion options (38%) and 15.5 billion futures (62%) traded.
  • Growth was driven by volumes traded in the Americas (up 6.7%, and accounting for 41% of total volumes traded), with increases across stock index futures, interest rate, currency and commodity derivatives.
  • In a reversal of the trend observed in 2015, the Asia-Pacific region (36% of the total volume), saw a decline of 5.5% in volumes traded vs 2015. This was mainly due to the decrease in volumes of single stock derivatives and stock index derivatives, whilst volumes of commodity derivatives grew by 27%.
  • In the EMEA region (23% of the total), volumes rose by 7.8% on 2015, driven by stock index futures, interest rate and commodity derivatives.
  • There were volume increases in all product lines, except equity derivatives and ‘other derivatives’ such as REIT derivatives and CFDs, (declines of 11% and 1.1% respectively vs 2015).
  • Commodity derivatives volumes - the most actively traded contract type in both 2016 and 2015 - grew by 27.5%.
  • Currency derivatives also continued strong volume growth, up 10.4% on 2015.
  • Finally, interest rate derivatives were up 5.5% in 2016, a reversal of the declines seen in 2014 and 2015.

Nandini Sukumar, Chief Executive Officer, WFE said: “Today’s report shows the global derivatives market in robust health, with volumes ticking up more than 2% compared to last year. The swing from equity to commodity derivatives in the Asia-Pacific region is a particularly interesting shift, and one we started to see in 2015. This trend towards commodity derivatives is also mirrored in EMEA and the Americas, with growth of 57% and 13% respectively, supported by strong growth in agriculture, base metal and energy contracts.”

She added: “The WFE is pleased to be hosting its 34th IOMA derivatives and post-trade conference this week.  We look forward to debating the issues of the hour with key stakeholders from the global market structure space.”

Siobhan Cleary, Head of Research & Public Policy said: “At the product level, whilst equity derivatives remain the most actively traded exchange traded product, their contribution is now below 50% of total volume traded - the first time since the WFE began its data collection of the derivatives market back in 2005. This contrasts starkly with the 22% CAGR experienced in commodity derivatives from 2005 to 2016.”

Today’s report coincides with the WFE’s 34th IOMA Clearing & Derivatives Conference, taking place today and tomorrow, in Frankfurt, Germany. The event, hosted by Eurex, will see more than 150 senior delegates from clearinghouses, exchanges, regulators and the buy side from around the world discuss the derivatives market and post-trade issues.

Please click here to read the IOMA derivatives report in full.  Forty-seven exchanges responded to the 2016 survey, a mixture of WFE members, affiliates and other exchanges that voluntarily submit data.