Eurex Debuts MSCI Korea Futures for Global Investors
Eurex, part of Deutsche Börse Group, has launched Futures on the MSCI Korea Index. It gives global investors efficient access to the Korean equity market. It simplifies portfolio diversification with Korean exposure through a single international trading venue.
About the Launch
Eurex has introduced futures contracts on the MSCI Korea Index. These are USD-denominated products to track large- and mid-cap segments of the Korean equity market. The contracts align with MSCI’s standardized index methodology. They offer institutional investors a structured and consistent way to gain exposure to Korea. They don’t need to access local exchanges.
The launch fills a gap for international institutional investors seeking Korean equity exposure. Most Korean derivatives were centered on KOSPI products until now. Retail traders and market makers mainly used them. Global asset managers and banks can access Korean markets more efficiently with the new futures.
What does Market Data Say?
Korea holds a 10.73% weight in the MSCI Emerging Markets Index. It makes Korea the fourth-largest country in the index. The MSCI EM Index covers large- and mid-cap stocks across 24 emerging market countries. Korea’s strong representation shows the need for dedicated investment tools like these new futures.
Benefits for Traders
This debut will offer these benefits:
Access to Korean Equities
Traders can get exposure to the Korean market without using local Korean exchanges. Eurex provides this access through USD-denominated futures. It removes currency conversion complexities.
Margin Efficiency
Eurex clears these futures through a single clearing house. This setup lets investors offset positions across multiple MSCI contracts. It reduces overall margin requirements.
Uniform Index Methodology
The MSCI Korea Index uses the same methodology as other MSCI products. Investors benefit from consistency in tracking performance across global markets.
Simplified Global Diversification
Traders can diversify across emerging and developed markets in one venue with Korean futures available on Eurex. It simplifies execution and strategy implementation.
Increased Liquidity
Eurex already sees 50% of its MSCI futures trading volume from Asia-Pacific. The new contract adds depth to this regional focus. It improves liquidity for those trading Asian underlyings.
About Eurex
Eurex is a derivatives exchange based in Germany. It offers trading in varied European-based derivatives. The merger of Deutsche Terminbörse (DTB) and the Swiss Options and Financial Futures Exchange (SOFFEX) established it in 1998. Deutsche Börse AG acquired full ownership of Eurex in 2012.
Summing Up
Eurex supports institutional investors in managing international portfolios with Korean equity exposure. This launch strengthens access to one of the largest emerging markets.
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