Market-Making and Liquidity Provisioning

The framework for your success

Step into a framework designed for clarity and efficiency. The Eurex Liquidity Provider Framework streamlines how you connect with our market and get rewarded for it.

How it works:

1. Sign the Master Agreement:
   Your journey begins with the Liquidity Provider Agreement (LPA), a comprehensive agreement that covers your partnership with Eurex Frankfurt AG and Eurex Clearing AG. One signature unlocks your potential.
    
2. Choose your products:
   Dive into the details with the General (GS) and Product-Specific Supplements (PSS). Here you'll find the clear requirements and attractive incentives for each product, giving you the power to choose where you want to provide liquidity.
    
3. Trade and earn – automatically:
   Our framework is fully automated for maximum efficiency. There is no need to subscribe or apply for individual products; simply begin quoting. Our systems will automatically measure your performance and process your incentive payouts, ensuring a seamless experience and removing administrative overhead.

Download the key documents and get everything you need to start your journey as a Liquidity Provider:

• Liquidity Provider Agreement
• General Supplement (GS) to the LPA
• Product Specific Supplements (PSS) to the LPA
• Price List of Eurex Clearing AG

Incentives available

LPs may receive Incentives that can be Monetary and Non-Monetary. All incentive details are included in the respective PSS.

Fulfilling your MiFID II obligations with a clear framework

If your activities include a Market-Making strategy under MiFID II, our Regulatory Market-Making (RMM) program provides the official framework to meet your compliance duties. This program is distinct from our incentive-based Liquidity Provisioning and is designed purely to fulfill legal requirements.

How the RMM framework works:

1. A single admission for all products:
   To begin, you must apply for admission as a Regulatory Market Maker. This is a one-time process; a single admission covers your RMM status for all products on Eurex, streamlining your setup and eliminating the need for product-by-product registration.
   Download the Application Form for Admission/Termination as a Market Maker at Eurex
    
2. Meeting your quoting requirements:
   Once admitted, your core obligation is to provide quotes in at least one Eurex product, meeting specific parameters on a monthly average. This ensures you fulfill your duties efficiently. Please note that your national competent authority may impose different or additional rules. The official quoting parameters are outlined in the document Eurex Quotation Parameters for Regulatory Market-Making, and the Spread Requirements are available in Tab 'Rmm_Spread_Class' of the spreadsheet Program, Product, Size and Spread details.
    
3. Monitor your compliance with ease:
   We provide a dedicated report to help you track your RMM fulfillment transparently. This report gives you a clear overview of your performance across all products, ensuring you always have the data you need to manage your regulatory obligations effectively. This performance data is available in Report TD983 on the Common Report Engine.
    
4. Consequences of Non-Fulfillment:
   It is crucial to manage your RMM status actively to avoid a compliance breach.
   
   Violations typically occur in two scenarios:
   (1) meeting the RMM criteria in a product without being formally admitted, or
   (2) being admitted as an RMM but failing to meet quoting obligations. Firms should ensure they are correctly registered or deregistered within a given month to prevent this.
   
   Should a potential violation occur, the Eurex Trading Surveillance Office will initiate a review. If confirmed, the case may be escalated to the independent Eurex Sanctions Committee, which can impose penalties under the German Exchange Act (§ 22 (2)). Sanctions may include a formal reprimand, a fine of up to €1 million, or a temporary exclusion from trading for up to 30 days.

For a detailed presentation and visual guide to these requirements, please check our Market-Making & LP Starter Pack. The section on Regulatory Market-Making can be found on pages 15-18.

This section provides key resources and technical details to support your market-making activities on Eurex.

Public list of Market Makers and Liquidity Providers

In compliance with regulatory requirements (Article 7 of Commission Delegated Regulation (EU) 2017/578), Eurex publishes a list of all admitted Regulatory Market Makers and participating Liquidity Providers.

Download the list of Eurex Regulatory Market Makers and Liquidity Providers

Overview of transaction fees and incentives

In the interest of full transparency and to comply with MiFID II requirements, Eurex provides a clear structure for both transaction fees and financial incentives.

Liquidity Classes

Eurex uses a system of Liquidity Classes (LC) to differentiate rebate levels for Liquidity Provisioning and volume-based incentives. This allows us to more effectively encourage liquidity where it's needed most. Products are assigned to one of three classes:

• LC1: Liquid products with standard incentive levels
• LC2: Less liquid products with enhanced incentive levels
• LC3: The least liquid products, which receive the highest incentives to support their growth

Download the Liquidity Classes file

Automated Quoting Parameters

To facilitate the automated programming of your quoting engines, Eurex provides a daily XML file containing the latest quotation parameters. This file, 90FILMMPARPUBLIYYYYMMDDXEUR, includes critical data such as maximum spreads and minimum quote sizes for all products.

By integrating this file, you can ensure your systems are always operating with the most current parameters, enhancing efficiency and accuracy. The corresponding XSD schema for this file is available below for integration purposes.

Download the MMPM Parameters on Common Report Engine
Download the XSD Schema for the MMPM file

Risk protection for Market Makers

The Eurex® system provides you with powerful, automated tools to manage your exposure and mitigate operational risk. These features are designed to give you greater control over your quoting activity.

Market Maker protection tool

This essential tool protects you from the risk of excessive, near-simultaneous executions of your quotes. It operates as an automated monitoring system that you control.

How it Works:

The tool functions like a counter, tracking the volume of contracts traded against your quotes within a user-defined timeframe (e.g., a few seconds). If the traded volume exceeds a preset limit within that time, the system automatically retracts all other quotes in that product, giving you time to reassess your positions.

You can configure this protection using three distinct thresholds:

• Volume: The total number of contracts traded
• Vega: The absolute difference between contracts purchased and contracts sold
• Delta: The absolute delta exposure, calculated as (long calls + short puts) - (short calls + long puts)