HOST: Mark Longo, The Options Insider

GUEST: Russell Rhoads, Indiana University's Kelley School of Business

GUEST: Philipp Schultze, Eurex

GUEST: Ryan Pitylak, NinjaTrader

This episode offers an in-depth look at the European derivatives markets. Topics discussed encompass differences between the European and U.S. market structures, the role of economic data, retail trading trends, European-style settlement origins, and the future outlook for European markets. The episode also addresses specific questions from listeners about the European crypto marketplace, warrants, and the term structure of VIX versus VSTOXX.

• Host: Mark Longo, The Options Insider Media Group
• Panelist: Eugen Mohr, Eurex
• Panelist: David Russell, TradeStation
• Panelist: Russell Rhoads, Indiana University Kelley School of Business

Host: Mark Longo, Owner and CEO of The Options Insider Media Group

Featured Guests:

• Russell Rhoads, Associate Clinical Professor at Indiana Kelley School of Business

• Matt Amberson, Principal and Founder of ORATS (Options Research and Technology Services)

• Daniel Murillo, Associate Vice President and US Sales Manager for Market Data and Services at Deutsche Börse (Eurex)

For traders looking across the pond, data access is the key to unlocking opportunities. In this episode, our panel tackles the challenges of finding, analyzing, and utilizing quality European derivatives market data.

On the Agenda:

• Data Deep Dive: Where can retail and professional traders find reliable, cost-effective data for Eurex products like EURO STOXX 50, DAX, and VSTOXX? Guests highlight essential free and paid resources.

• Backtesting the Continent: ORATS's Matt Amberson details how the unique, often sideways movement of European stocks offers different—and sometimes better—backtesting results for strategies like covered calls compared to the U.S. market's long bull run.

• The Race for Speed: Daniel Murillo of Eurex shares an insider look at the exchange's data services, including T+1 flows and new picosecond-level timestamping for High-Frequency Traders.

• VIX vs. VSTOXX: Russell Rhoads analyzes the difference in the futures term structure between VIX and VSTOXX, revealing why the European volatility index offers unique trading dynamics, especially as the U.S. trading day slows down.

This episode delves into the world of European dividends and the specialized futures and options markets used to trade them. Host Mark Longo is joined by Dr. Russell Rhoads (Indiana University), Lorena Dishnica (Head of Dividend Products, Eurex), and Sahand Taghizadeh (Head of Investable Stocks Benchmarks, STOXX).

• Key Differences: Unlike the U.S. with its quarterly payments and buyback culture, Europe favors annual dividends, with a "dividend season" in spring/summer.

• Dividend Futures: Eurex pioneered a listed market for dividend derivatives in 2008. These products allow traders to isolate and hedge dividend risk, which is a key need for banks that issue structured products.

• Analyzing the Market: The most liquid contracts are the annual Decembers. They can be used to gauge the market's fundamental outlook, as their prices are sensitive to corporate cash flow forecasts and macroeconomic events.

• The Curve: The European dividend futures curve often shows a downward slope, known as backwardation, reflecting the heavy hedging activity.

• Listener Question: A listener asks about smaller contract sizes. While dividend futures are not yet micro-sized, the options on them offer a way for traders to manage their capital commitment.

Welcome to the European Market Brief, Episode 8! In this episode, we dive into a transatlantic financial showdown, comparing the European and U.S. markets. Join Mark Longo and special guests Russell Rhoads, Christoph Schon, and Zubin Ramdarshan as they explore everything from market concentration and volatility to the surprising resurgence of the European defense sector.

[00:03:52] - Introducing the Panelists

• Host Mark Longo, CEO and founder of The Options Insider Radio Network

• Russell Rhoads, also known as "Dr. VSTOXX," from Kelley School of Business - Indiana University

• Christoph Schon, Lead Principal at SimCorp

• Zubin Ramdarshan, Global Co-Head of Derivatives Products and Markets at Deutsche Börse

[00:10:07] - The US vs. European Market Structure

[00:13:30] - Sector Trading in Europe

[00:16:30] - The Small-Cap vs. Large-Cap Debate

[00:18:48] - Recent Market Performance

[00:23:38] - The Impact of US Headlines on Europe

[00:27:10] - The European "Tech" Sector Analogs

[00:29:40] - The Role of Earnings Season in Europe

[00:32:04] - The Rise of the European Defense Sector

[00:36:54] - Final Takeaways

[00:41:26] - The Red Phone: Listener Q&A Regarding the Spread between VIX and VSTOXX & Zero-Day Options in Europe

Where to Find Our Guests

• Christoph Schon: Learn more about his research and insights at https://simcorp.com/resources/insights.

• Zubin Ramdarshan: Connect with Zubin on LinkedIn (Zubin Ramdarshan) or explore product details at Eurex.com.

• Russell Rhoads: Follow Russell's research and commentary on Twitter: @RussellRhoads.