Eurex contemplates improvements in reaction to the launch of Cboe Flex options
In a move that is set to shake up the European derivatives market, Cboe Europe Derivatives (CEDX) has announced plans to launch FLEX options in Europe, extending a US product it pioneered in 1993. This announcement, made at Cboe's risk management conference in Munich, directly challenges Eurex's flexible contract facility.
Eurex, a leading player in the European derivatives market, has already seen a surge in the volume of flexible options in the single equity space. A Eurex spokesperson stated that flexible options at Eurex are already above last year's volume, suggesting a likely continuation of this trend. As of 15 September, flexible option-like OTC at Eurex account for about 3% of total option volume.
The launch of FLEX options by Cboe is putting it in more direct competition with Eurex. Iouri Saroukhanov, head of European derivatives at Cboe Europe, expressed excitement about bringing Cboe FLEX options to the European market. At launch, CEDX expects to list FLEX on a select set of Cboe equity indices, single stocks, and ETFs.
Cboe did not comment on the value of its own FLEX open interest but mentioned its volume has grown from two million contracts traded in 2019 to 35 million so far in 2025. If the 3% flexible contract share of option volume were extended to open interest, it would imply about US$11.8 billion in flexible-contract OI.
Cboe has also announced the launch of a course to introduce FLEX options in Europe, with the implementation planned for 2026; however, the exact starting date has not been explicitly stated in the available information. All trades will clear at Cboe Clear Europe, its pan-European central counterparty (CCP). The go-live for CEDX's FLEX options is targeted for Q1 2026.
FLEX options allow traders to negotiate key contract terms within an exchange rulebook and central clearing, similar to bilateral OTC trades. This flexibility makes them popular for portfolio hedging. FLEX options at Eurex have seen year-to-date volumes of 7.87 million contracts, compared to 213 million total equity option contracts.
Eurex expects increased volumes in FLEX options, especially in the single equity space. The BIS reports US$50 billion of OTC European equity-options gross market value at the end of 2024, compared to US$279 billion for US equity OTC options. OTC derivative gross market value is reported by dealers to the BIS at replacement cost, making a like-for-like comparison with listed derivatives difficult.
Despite the competition, Eurex is having ongoing conversations with market participants about enhancing its flexible derivatives offering. This suggests that Eurex is not resting on its laurels and is ready to respond to the challenge posed by Cboe's entry into the European FLEX options market.
In conclusion, the launch of FLEX options by Cboe Europe Derivatives is set to bring a new level of competition to the European derivatives market, particularly in the single equity space. As both Eurex and Cboe prepare to enhance their offerings, it will be interesting to see how the market evolves in the coming years.
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