Rising trading volume despite decreasing market volatility

Volatility of equity markets continued to decrease in June 2020 compared to the highest levels from March this year, despite a slight increase during the first half of June. Both VStoxx in Europe and VIX in the US stabilized around 30 after a peak at 40 mid-June, when the Federal Reserve said to hold interest rates steady at near-zero levels until at least 2022.

“Investors’ ability to forecast markets in June was limited, hence, uncertainty remained high. On the other hand, we observed that investors assessed major unexpected swings to be unlikely, because markets were less volatile in June compared to March and April. Despite this decline in volatility, monthly trading volumes increased. This indicates, that our growth is sustainable”, said Thibault Gobert, Sales Executive at Spectrum Markets.

Spectrum Markets increased its trading volume for nine consecutive months of full trading. In June 35.3 million securitised derivatives were traded. This represents a 2.3% increase over the previous month and sets another record.

The share of out-of-hours trading (i.e. 1730-0900) was 38.7%.

The breakdown of trading volume of securitised derivatives in June is as follows: 81.7% is attributable to indices (May: 86.4%), 11.5% to FX (May: 7.7%) and 6.8% to commodities (May: 5.9%).

The top traded underlying were DAX with a share of 21.5%, followed by the OMX with 21.0% and the S&P 500 with a share of 17.6%. All 21 underlying have been traded in June (overview).

Quarterly figures are on a positive trend as well: 98 million securitized derivatives were traded in Q2 2020, an increase of +63% on Q1 2020. The quarterly share of out-of-hours trading stabilized at 40% in Q2, vs 40.6% in Q1 this year.

Spectrum Markets is a pan-European marketplace where retail investors can invest in structured products via their brokers. From its launch, trading has been available in ten countries: Germany, France, Italy, Spain, Sweden, Norway, the Netherlands, Ireland, Finland, and Belgium.

About Spectrum Markets
Spectrum Markets is the trading name of Spectrum MTF Operator GmbH. Headquartered in Frankfurt am Main, Germany, it is a pan-European trading venue for securitised derivatives aimed at financial institutions and their retail investors. Regulated by BaFin and MiFID II compliant, the exchange uses a uniquely open architecture system to allow investors to trade with increased choice, control and stability. Through its pan-European ISIN, 24/5 trading services and its own proprietary venue, Spectrum enables a guaranteed baseline level of liquidity over a range of products and is able to swiftly and safely match a significant number of orders and process multiple quotes every second. Further information can be found at spectrum-markets.com

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E-Mail: SpectrumMarkets@fticonsulting.com