Medio Institucional

Transaction adjustments for same day business lead to immediate adjustments on the position accounts of the members. Corrections can also be carried out for already existing positions. The user can enter position closing adjustments, position account type adjustments, and position transfers between members into the system.

Position closing adjustments are possible during the product states Pre-Trading, Trading, Post- Trading Full (incl. Post-Trading Late1 and Post-Trading Late2). Closed positions cannot be reversed into open positions. Position close outs can be uploaded in bulk using the Position Close Out Bulk Load window, accessible via the Upload Close Out... button on the Position Overview window.

Classic position transfers between different members (no market maker positions) are allowed from the pre-trading until the end of the post-trading-full period. However, the actual adjustment is performed in the pre-batch assignment process or during batch processing.

Real-time position transfers between different members (no market maker positions) are allowed from the pre trading until the end of the post-trading late1 period. However, the actual

adjustment is performed as soon as all concerned parties approve the transfer.

Exercised or assigned positions cannot be transferred. Position transfers can be uploaded in bulk using the Position Transfer Bulk Load window, accessible via the Upload Pos. Transf. button on the Position Overview window.

As with trade adjustments, these corrections lead to an immediate adjustment of the corresponding positions.

Position transfers between different members (no market maker positions) are allowed from the pre-trading until the end of the post-trading-full period. However, the actual adjustment is performed in the pre-batch assignment process or during batch processing.

Real-time position transfers are allowed between different members, and are executed as soon as all concerned parties approve the transfer.

Position Transfers are only available for Eurex/ISE Link trades if the source and destination member are Eurex Members with the assignment of the respective OCC product.

Position adjustments are not possible for trades in the “Eurex KOSPI Product”.

The RPTCB030 POSITION TRANSFER OVERVIEW REPORT lists the details of partial position transfer transactions for a member.

The RPTCB120 MEMBER EXCEPTION - POSITIONS REPORT lists all unsuccessful position transfers, that is, those that are manually deleted or have insufficient approvals or insufficient positions.

Note: The features of “account transfer”, “complete position transfer” and “full to agent account transfer” are only supported for Eurex. The feature “partial position transfer” is supported for members and Eurex.

2.5.5.1 Position Closing Adjustments

In accordance with Eurex Conditions for Trading, section 3.1. “Types of Orders and Quotes”, paragraph 3, orders must be identified upon their entry as either orders as principal or on behalf of customer accounts and, for purposes of recording them, as opening or closing transactions. Because positions on the A and P accounts are not netted automatically, high numbers of open positions can be built on both the long and short side when orders are routinely recorded with the “To open” indicator. To provide a correct open interest reporting, the member accounts must reflect the true open position.

Eurex therefore offers various trade and position adjustment features in order to adjust positions:

Adjusting Open Positions: Accumulated positions can be reduced by:  Recording a new trade as a closing transaction.

 Amending a trade using a Trading Close Adjustment.

 Carrying out a position closing adjustment to reduce the open long- and short- positions equally.

Adjusting Closing Positions: An open position can be adjusted using the provided close out functionality on the Position Overview screen. This reduces the long and short side of the position equally. A distinction is made in the Eurex System between cost-free and fee-liable position closing adjustments, as follows:

 Cost-free Position Closing Adjustments:

 Close out of option positions (with the exceptions of options based on futures).  Close out of futures and future-based options within the zero cost quantity range.  Fee-liable Position Closing Adjustments:

Zero Cost Quantity (ZCQ): Zero Cost Quantity is the potential number of contracts that can be closed out without late closing fees being charged.

 Trades Done On The Actual Trade Date (t): The Zero Cost Quantity is valid from 13:30 CET on t until 13:30 CET on t +1. From 13:30 CET until end-of-day on the trade date it is called Current ZCQ and is calculated as follows:

Current Zero Cost Quantity = trades to open + trades booked to open after trade closing error + take-ups to open + trades booked to open after take-up closing error +/- trade account transfers for trades to open + trade to open adjustments - trade to close adjustments - current give-ups which were taken up - position closing adjustments.

 From start of the day on t+1 until 13:30 CET: The ZCQ is called Previous ZCQ and is calcu- lated as follows:

Previous Zero Cost Quantity = Remaining ZCQ from previous day if > 0, else 0 - historical give-ups which were taken up - historical trade transfers1 of trades of the previous business day + futures positions created after exercise of options on futures + historical take ups - position closing adjustments.

Within the Position Adjustment - Close Out and Position Adjustment - Account Transfer windows, the current and previous zero cost quantity is shown. If the member wishes to close out more contracts than available within the zero cost quantity, an additional window is displayed requesting confirmation.

Position close outs can be uploaded in bulk using the Position Close Out Bulk Load window, accessible via the Upload Close Out... button on the Position Overview window.

2.5.5.2 Member Internal Position Adjustment

Members can carry out the following types of adjustments in the Position Adjustment - Close Out and Position Adjustment - Account Transfer windows:

 Position adjustments for liquidation purposes.

 Position transfers between member position accounts.

Positions in an options series or a futures contract can only be liquidated if those series or contracts have open long and open short positions that are not currently designated as pending give-up trades.

2.5.5.3 Position Transfer between different Members

The Position Transfer Overview window allows a member to confirm/cancel transfer positions to another member. All members concerned must agree to the transfer. Member position transfers are possible using any combination of P1, P2 and agent accounts for the source and destination accounts.

Members can transfer positions via the real-time position transfer facility, which enables positions to be transferred real-time, or the classic position transfer, where positions are transferred during the state change to post-restricted. Appropriate:

 Classic position transfer transaction types are '106' (Partial Member Transfer) and '107' (Par- tial Position Transfer with Cash Amount)

 Real-time position transfer transaction types are ‘306’ (Real-Time Position Transfer) and ‘307’ (Real-Time Position Transfer With Cash).

For position transfers with cash, members can, depending on their RAL settings, select whether to process the transfer using the four-eye principle. That is, when an initiator chooses to enter/ approve the transfer of their positions, depending on their RAL settings, an Approve message window may be displayed requesting a second, different, user confirm the transfer.

Position transfers can be uploaded in bulk using the Position Transfer Bulk Load window, accessible via the Upload Pos. Transf. button on the Position Overview window.

When a member enters a position transfer, the system issues a transaction number. This transaction number must be communicated to the other parties involved in the transaction as they must enter it into the system to indicate their acceptance. After all parties have agreed to the transfer, each member still has time, until the end of the post-full-trading period, for classic position transfers only, to cancel the request of transfer and consequently cancel its acceptance. This withdrawal is shown to the involved parties in RPTCB120 MEMBER EXCEPTION -

POSITIONS REPORT, as are any deleted position transfers.

Position transfers cannot be entered or cancelled in the post-restricted-trading period. Members can instruct Eurex to transfer all or part of their open positions to another member. This

transaction is carried out as described above.

The transfer type “partial position transfer with cash amount” on the existing Position Transfer Entry window allows the transfer of positions and related cash amounts between different members. The Cash Amount and Orig Trade Price fields on the Position Transfer Entry window deals for this purpose. The corresponding transaction types ‘107’ (Partial Position Transfer with Cash Amount) and ‘307’ (Real-Time Position Transfer With Cash) enable members to use a standard Eurex function to transfer a position and a related cash amount.

The associated cash amount can be positive or negative. A positive amount indicates a debit transfer source; a negative amount indicates a credit transfer source. This means that if the initiating member enters a positive amount, a debit is associated on his side and the destination member receives this amount.

Partial position transfers with cash amount can be entered and confirmed during the following trading phases: pre-trading, trading, fast market and post-trading full. The cash amounts entered are in the currency of the related product. The position and cash amount transfers are carried out between members using agent and proprietary (P1,P2) accounts.

The entry, as well as the confirmations of partial transfers with cash amounts, can be done on behalf by Eurex Market Supervision.

Partial position transfers on positions in futures or option products, where the premium is settled futures-style, are executed with the previous day’s settlement price. Partial position transfers for newly created series are rejected with an appropriate error message. For trades entered or transferred to the accounts A1 - A9, the user is able to enter a give-up/take-up transaction instead.

For classic position transfers, if the position quantity remains empty for a chosen contract, only a cash amount can be transferred. A contract must be specified to determine the currency, even for a cash only transfer.

Three additional optional text fields Customer, MIOrdNo and Text are added to the Position Transfer Entry window. These fields allow members to enter customer-related details associated with the position transfer, for example, when a member internal order number or a comment. These fields are also displayed on the relevant reports, for example, the RPTCB010 POSITION DETAIL REPORT.

Multiple partial position transfers (with or without cash amounts) per contract and per day are possible between the same members.