In 2003, global equity derivatives exchanges saw a total of 5.6 bn equity (index and single stock) contracts traded, a rise of 34% on the 2002 figure of 4.2 bn contracts. The notional value of the 5.6 bn contracts was approximately $50 bn. Global cash equity exchanges saw a total turnover of $33.3 trillion 1 , a slight increase (0.9%) on the 2002 figure. This report continues the analysis WFE provides of comparative developments in cash equity and equity derivatives markets and notes that in some regions, especially developing Asia, the growth of derivative markets has not entirely kept pace with evolution of cash markets. The structure of the report is: Regional development of equity derivatives markets 2 Development of cash equity markets Cash equity versus equity derivative volumes – update Cross-sectional analysis of equity derivative notional values and cash equity values. 5. Concluding remarks 1. 2. 3. 4.
Otherwise expressed, $33 trillion means $ 33 000 000 million.
As in last year’s report, we note and adjust for the Korea Stock Exchange whose extremely high volumes of low notional value contracts cause distortions in the statistics which mask certain other interesting developments. In fact, this business is worth highlighting and analyzing.
Equity Derivatives and Cash Equity Trading – WFE – December 2004
1. REGIONAL DEVELOPMENT OF EQUITY DERIVATIVES
In this section, we look at regional patterns of growth and have divided the global figures into regions based on geography and degree of financial market development. The six regional groups are : • • • • • • Asia – developed Asia – developing Europe 3 – developed Europe - developing North America Latin America
Appendix A shows how exchanges are grouped by region, and...