Announcement of T7 Release 8.1

1.  Introduction

Deutsche Börse AG plans to introduce T7 Release 8.1 on 29 June 2020. The simulation period for T7 Release 8.1 is planned to start on 4 May 2020.

The following functional enhancements will be introduced in T7 Release 8.1:

• Expiry-dependent TES attributes
• Eurex EnLight SMART trading capabilities
• Eurex EnLight anonymous request and response
• Mandatory PIN procedure for Trading on Behalf and other inquiries
• Equity Bespoke Baskets
• TES auto approval rules for clients

Further enhancements will be communicated in the Functional and Technical Release Notes published as preliminary version in January 2020.

This circular provides T7 Participants with the T7 Release 8.1 timeline, planned scope, and the communication schedule.

2.  Required action

Trading Participants are requested to initiate the preparatory steps for software readiness for the new T7 Release 8.1 on 29 June 2020.

3.  Details

A.  Implementation and communication schedule for T7 Release 8.1

The production launch of T7 Release 8.1 is planned for 29 June 2020. Please refer to Figure 1 in the Attachment for an overview of the introduction schedule.

Deutsche Börse AG will provide a dedicated release simulation environment in order to give Trading Participants the opportunity to perform comprehensive testing of their trading applications, independently of the T7 production environment. The simulation period for T7 Release 8.1 is planned to start on 4 May 2020.

In addition to the T7 release simulation, Trading Participants can also use the T7 Cloud Simulation that allows Trading Participants and Independent Software Vendors (ISVs) to test against the current T7 production and simulation software versions. In this environment, Trading Participants can initiate predefined market scenarios and test specific strategies more easily than in a shared environment. The T7 Cloud Simulation is permanently available (24/7) for a fixed price per hour and is accessible using an SSL-encrypted internet connection. The T7 Cloud Simulation will start in advance of the usual release simulation.

For more information on the T7 Cloud Simulation, please refer to the Eurex website www.eurexchange.com under the following link:

Technology > Eurex T7 Cloud Simulation

Eurex Exchange is committed to providing Trading Participants and ISVs with information updates throughout the development of T7 Release 8.1 in order to support adequate planning and to ensure a successful launch.

In January 2020, Eurex Exchange will publish the detailed preliminary release notes listing the functional and technical enhancements that will be available in T7 Release 8.1.

The existing documents, as listed in Figure 2 in the Attachment, will be revised for T7 Release 8.1:

• Preliminary versions (identified by a diamond) will be published in January/March 2020,
• Simulation versions (identified by a square) will be published in April 2020, and
• Final versions (identified by a circle) will be published in April/May 2020 prior to the production launch

The documents will be available on the Eurex website under the link:

Technology > T7 Trading architecture > System documentation > Release 8.1

B.  Overview of functional enhancements

The following chapters provide an overview of the functional enhancements which will be introduced in T7 Release 8.1.

Expiry-dependent TES attributes

Expiry-dependent minimum quantity thresholds primarily for block trades are currently only supported for simple instruments. With the introduction of T7 Release 8.1, this functionality will be enhanced to support expiry-dependent minimum quantity thresholds also for the following non-simple instruments:

• Flexible Instruments
• Futures Calendar Spread 
• Standard Option Strategy
• Options Volatility Strategy
• Non-standard Option Strategy

The expiry-dependent minimum quantity thresholds are referring to the minimum lot size and to the non-disclosure limit.

Eurex EnLight SMART trading capabilities

The Eurex EnLight SMART Request for Quote (RFQ) will allow Eurex EnLight customers to use exchange data to assist brokers and traders in targeting the Trading Participant most likely to have an interest in a specific RFQ. This will increase the probability of tighter spreads and better pricing outcomes for the end client or risk desk. The proposed list of responders will be generated against defined criteria, which can be weighted according the importance of each criterion attributed to it by the requester. The proposed list will not be compulsory, which means that responders have to actively opt-into the process by submitting a quote

Eurex EnLight anonymous request and response

The Eurex EnLight anonymous negotiation functionality will enable requesters to send anonymous RFQs. In this case, the identity of the requester is not disclosed to the responders during and after the negotiation process. Also, the identity of the responder when sending a quote will no longer be visible to the requester after initial selection. The Eurex EnLight anonymous negotiation offers a new means of negotiation for requesters that are sensitive to inventory tracking or simply wish to remain anonymous because they believe this will result in ultimately better pricing outcomes for the end client or risk desk. Anonymous negotiation will be optional, requesters will be free to choose, if they want to disclose their identy.

A Trade to Response Ratio (TRR) will be published with each anonymous RFQ. This ratio gives an indication of the requester’s intent to trade based on quotes received. The higher the ratio, the higher the intend to trade and thus the better the price received. Therefore, responders can use the TRR to identify high performing requesters. Responders will be able to choose if they want to receive anonymous RfQs or not or whether they just want to receive anonymous RfQs, which are above a ratio threshold defined by the relevant responder.

Mandatory PIN Procedure for Trading on Behalf and further inquiries

With T7 Release 8.1, the user attribute PINCode will become mandatory for all Eurex users, i.e. it will no longer be possible to set up new Eurex users without setting a dedicated PIN code.

Eurex will further enhance the Trading on Behalf (ToB) authentication process shortly after the launch of the T7 Release 8.1 such that the user ID/PIN legitimation will become mandatory for all exchange participants for ToB requests and for all Trading Participant inquiries by phone which currently only require a member and user ID for processing.

Equity Bespoke Baskets

The T7 off-book functionality will be enhanced to support a new type of baskets, denoted as Equity Bespoke Baskets (EBB), which refers to equity related Futures. EBBs will be implemented based on the basket features of Basket Total Return Futures (BTRFs). An EBB will consist of a number of TES trades in different future instruments denoted as EBB components being entered, approved, and executed together. After the successful execution, an EBB will be decomposed into its ETRF components and the individual trades with a reference to the basket will then be forwarded to clearing. EBBs will support the basket amendment operation where participants can change the composition of a specific EBB basket by adding more component trades to the basket, where the additional trades may also be counter trades, effectively reducing or removing individual or all positions in the basket.

TES auto approval rules for clients

Eurex will enhance TES auto approval rules for clients, which will allow Trading Participants to user a more detailed definition of TES auto approval rules. The possibility to define rules using the product, TES Type, Instrument Type, and Enrichment Key (which can be client-specific) in addition to the currently existing parameters will enable Trading Participants to perform more straight through processing of their client off-book business.

Attachment

• Overview of the introduction schedule (Figure 1), communication schedule (Figure 2)

Further information