History repeating with failing Euronext
For the second time in seven days Euronext fails at calculating correct expiry levels.
Nobody is perfect. Organizations aren’t perfect either. However, when organizations fail consistently in performing simple yet important routine tasks – there’s something seriously wrong. Of course I’m referring to Euronext. Sometimes a little slow and always overcharging their customers, but previously it had a reputation of being reliable.
Less than two weeks ago it messed up the calculation of the expiry levels of the weekly AEX options. All market makers were left with unhedged positions and were hardly informed at all. Some had unexpected profits, some experienced unexpected losses. Retail investors didn’t have a clue what was going on either.
Fastforward seven trading days later. Volatile markets and Euronext can’t even handle heavy trading – they even shut down the market in warrants, turbo’s and speeders. During the expiration procedure of the daily options (the A9) the AEX index level wasn’t broadcasted between 15:45 and 15:55. Euronext notified market participants after the expiration procedure was finished (16:00).
Market services decided to recalculate the missing index levels. Shouldn’t be that hard after all, my grandmother can do it. The whizz kids came up with an expiry level of 283,33 – which was wrong. The true expiry level should have been one index point lower. After regular market close the official expiry level was adjusted to 283,28. Painful. Every call in the A9 is settled one euro too high, and every put one euro too low. And it seems Euronext doesn’t even know it.
As one trader describes it:
“Look, as liquidity provider we have the obligation to quote the options until 16:00. Therefore we calculate the AEX index levels ourselves on a continuous basis. That’s easy and very straightforward. We know what we are doing, and the expiry level should have been something like 282,34. For example our final quote in the 282 call was 30 – 40 cent. That was market consensus. The clowns at Euronext probably made calculation errors – so the 282 call ended at 1.28. Last time when they blew it in the AX5, we were lucky and made a lot of money. Today we lost a little because of Euronext. The problem is we can’t rely on the exchange anymore – neither can retail investors. “
LEGE SCHERMEN IN DE A10 OP DIT MOMENT!
bedankt Euronext
Nobody is quoting in de expiring daily’s anymore at the moment. Investors can’t get out.
oh but they can get out … AT FUCKED UP PRICES!
Not going to risk my balls quoting during expiration. Expiry level could be anywhere. Random game now.
Euronext, FYI — this is how you do it: http://en.wikipedia.org/wiki/AEX_index
Use a spreadsheet if you have to.
Depressing all market makers quit quoting during expiration. But I can understand it though.
mm are going on strike collectively rather than competing with each other, Nice,
piet-particulier kan langskomen hoor!
de expirerende dagopties staan €4.50 wijd gesteld, allemaal!
jammer dat mijn electronic eye sneller is….
Het is echt een grote schande allemaal! Sinds de verplaatsing van de hub van Parijs naar Londen is het een grote chaos.
Price feeds zijn minuten vertraagd en ik heb begrepen dat alle handelaren op Beursplein 5 ernstige problemen ervaren.
Claims om de opgelopen schade worden natuurlijke netjes terzijde geschoven!
Euronext zet zichzelf inderdaad ten schande. Als je niet eens een indexprint kunt uitrekenen dan moet je jezelf diep gaan schamen.
shame, shame, poppy shame,
all the donkeys know your names ..
The idiot part is Euronext isn’t even informing us during the expiration. Only AFTER expiration they notice you of index trouble. The solution is unreliable too. Skipping a few index prints? Or closing at 17:30?
The latter could be big fun with this days of heavy swings.
“Sorry pal, expiration is 12 points lower compared with what you thought at 15:45”
‘if they knew at 15:30 they had problem, they’ll just take 15 min to sit their ass down, take down manually levels at each tick and then calculate index level using their big ass calculator for blind people and spare everyone of this bs ..
for an outsider. How have the volumes in AEX been recently. Have these bloopers led to volumes dropping ?
http://fd.nl/beleggen/950018-1108/veb-in-overleg-met-euronext-over-compensatie-storing
i think its fair of the Euronext to recognize the mistake and pay up .. or atleast the courts should be able to understand derivatives enough to understand euronext’s fault ?
Wel lachen dat een beetje jan particulier gewoon een spread sheetje op zijn labtoppie heeft draaien en precies weet wat de index staat en dat de zg. experts bij Euronext geen idee hebben. Erg zorgwekkend! Maar goed, volgens mij nooit anders geweest. In the old days kwamen ze ook altijd in de pit vragen hoe het ook al weer zat met een stocksplit oid.
Misschien tijd voor een reputatie poll op dit blog
a) Ik vind euronext een van de slechtste exchanges die er is
b) ik heb nooit problemen met euronext
c) ik heb een perfecte relatie met euronext
d) next…
Probably euronext considers live feed to be too expensive, so its employees only get delayed google finance feeds to calculate the aex levels. Not realising this, they keep taking the print every minute between 15.30 and 16.00.
‘why dont somebody take screenshots from BBG and email it to Euronext, that ways there is lot lesser chance of getting a lawsuit filed against themselves,
Het makkelijkste is om een minuut na de laatste tick even drie MM te bellen en waarschijnlijk hebben minimaal twee hetzelfde binnen 0.05
Bellen is niet nodig. Gewoon even op het quotescherm van de opties kijken is voldoende. Op moment dat die prijzen erg afwijken van wat ze zelf uitrekenen nog eens controleren lijkt me.
the world is full of morons, you just gotto make sure they dont kill you off with their stupidity,
Why does nobody mention the obvious: Just read the rules®ulations of Euronext. The procedures might make no sense but at least they follow the rules!!!
what does it say the procedure for the case of euronext being a complete moron?
what I do not understand is why you are all still trading on enxt, if it is that bad, sucks, a bunch of morons, clowns, etc. why don`t you take your bag with pennies and move on to another exchange. By doing so there is more left for others and it will save you from typing a lot of shit comments
what are alternatives to Euronext? isnt it monopoly? where is Office of Fair Trading and Competition, apart from MSFT and GOOG, Euronext and Co should be investigated for monopoly being broken off, trading is and should be the most capitalist activity, not a monopoly,
http://fd.nl/dowjones/220680-1109/nyse-vergoedt-schade-optiebeleggers_bron_dow_jones
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