MEFF launched European-style cash-settled options this year and is also developing a retail strategy. The derivatives market of Spanish exchange group BME also has plans to expand its derivatives contracts from Spanish to European stocks.

Clotilde Salmerón, head of MEFF, BME told Markets Media that the market launched European cash-settled options after a request from a client. After talking to other exchange members and performing the analysis, MEFF found it was also a very good proposal for all the market participants.

European options can only be exercised on the expiration date of the contract. In contrast, American options can be exercised at any date, up to and including the expiration date, so they require more complex valuation models and typically have higher premiums due to their increased flexibility. The new options are cash settled and are not settled in stock.

Robert Switzer, European head of derivative sales at Susquehanna, said in a statement that the market maker’s clients were interested in trading European cash settled options due to the simplified expiration. Switzer said: “Susquehanna supports the continued development of innovative products and we are excited to see volumes starting to grow.”

Imanol Urquizu, head of derivatives – derivatives solutions at Santander Asset Management, said in a statement that the launch of the new contracts is “excellent” news for Europe’s income and value funds, which together manage more than €500bn. These funds often hold large portfolios of dividend-paying or value stocks, and he explained they can run call-overwriting strategies without the fear of their shares being called away at expiry.

“That means they can generate extra income on top of dividends, while at the same time improving risk-adjusted returns by reducing drawdowns,” Urquizu added. “It’s a very practical use case where cash-settled options can make a real difference.”

In addition, he said cash-settled options are a real step forward for yield enhancement strategies in private banking as they can shift from over-the-counter structures to standardised listed contracts.

Urquizu said: “Everything becomes much simpler — easier to open accounts, easier to manage from a compliance and transparency perspective, and far more efficient on collateral.”

Growth strategy

In the initial phase of MEFF’s European-style cash-settled options, the underlying stocks are Banco Santander, Banco Sabadell, BBVA, Endesa, Iberdrola, Inditex, Repsol, and Telefónica.

There has been an increase of volumes in Spanish single stock options across Europe, according to Salmerón, and MEFF has 70% of the market share of single stock options in Spanish names. She put the increased volumes down to the IBEX 35, the Spanish blue chip index, being one of the best performing national indexes across Europe, the macroeconomic results of the Spanish economy, and portfolios holding more Spanish stocks. The IBEX 35 surpassed 16,000 points on 27 October this year, which represented an all-time high.

BME is part of Switzerland’s SIX Group. In October this year SIX reported that MEFF stock options traded had the greatest rise in year-on-year volume at 78.1%. Overall turnover on the Spanish market in October rose 23.2% to reach €53.3bn in October.

Salmerón said: “At the moment we only have local Spanish stocks as underlyings, but we are working to be able to offer contracts on European equities from other countries.”

She continued that MEFF also needs to be part of the big European movement to give more easy access for retail to capital markets.

“Growth will come from the retail strategy we are developing,” Salmerón added. “Our group includes the BME Institute that does amazing work on financial literacy and derivatives which helped us to build an ecosystem of professionals and will also be very relevant for retail.”

Gregor Braun, head cash market sales, exchanges at SIX, said in a statement: “As we have entered the final quarter of 2025, both the Swiss and Spanish indices are maintaining growth trajectories. Many trading segments, including equities, derivatives and fixed income, have also demonstrated robust performance.”

Being part of the SIX Group “really helps” according to Salmerón, as the Spanish market is part of a bigger group and more well known across Europe.

Technology

“In the near future we will be part of the new unified trading platform across equity, fixed income and derivatives and allow us to offer new features and functionalities,” she added.

On 29 October SIX said in a statement that Aquis Technologies has been selected as the technology provider for the implementation of a harmonized trading platform for the group. SIX completed its acquisition of Aquis, the London-based pan-European exchange, in July this year which it said positioned SIX as the only exchange group providing listing venues in all major European financial centers, including Switzerland, the European Union and the UK.

The exchanges will be run across the Aquis Equinox matching engine which underpins multiple exchanges and trading venues worldwide and clients will benefit from easy market access and more liquidity according to SIX.

Tomas Kindler, global head exchanges & executive board member at SIX, said in a statement: “With the concept of ‘One Plug, Multiple Trading Venues’, our existing participants in the Swiss and Spanish markets will be able to benefit from a next-gen trading system, delivering innovation, new functionalities and unrivalled access to investment opportunities in multiple markets with just one harmonised connection standard to our multiple trading platforms.”

SIX said it selected Aquis following a comprehensive, multi-stage selection process involving several vendors, and joint development work has commenced with strong momentum. The new platform for equity and equity-like products is expected to launch in 2027, with other asset classes to follow, dependent on regulatory approval.