Exchange-traded derivativesIn acknowledgement of the global trend towards using derivatives as a means of portfolio risk management, the German Futures and Options Exchange (Deutsche Terminbörse, DTB) was created in 1990. Since then, the amount of DAX futures, DAX options and stock options has grown steadily. When compared to the spot market, this increase is impressive. In 1996, DAX futures (worth Dm100 per index point) equating to Dm1.41 billion were turned over. Hence, DAX futures trading volume accounts for 115% of total turnover on the spot market, compared to only 34% in 1992. Since the beginning of 1996, the number of DTB tradable single stock options has increased from 20 to 41, and now covers almost all active German shares. Introduction of options on Deutsche Telekom shares on the second trading day after the IPO in November 1996 set new standards in providing investors with instruments for managing their equity exposure. The volume in exchange-traded options has increased by 17.5% in 1996 over 1995. For further refinement in interest rate risk management, new products such as the new two-year future contract (Schatz future), the one and three-month Libor contracts replacing the old Fibor future and a range of exchange-traded yield curve spread contracts were introduced by the DTB. |