In the second quarter, the total number of traded contracts was 10.46 billion, down 8.4% from the record-breaking 11.41 billion contracts traded in Q1 2020, but up 21.8% from the second quarter of 2019. In fact, the second quarter volume was higher than any other quarter in the history of the industry aside from the first quarter of 2020.
Open interest, which measures the number of outstanding contracts at a single point in time, did not track the change in trading activity, however. Total open interest at the end of June was 915 million contracts, up 3.4% from June 2019.
“What the data demonstrates is that there was a very large increase in turnover in the first half of the year as market participants reacted to the impact of the pandemic on global economic activity, but the overall amount of risk held by market participants increased only slightly,” said Will Acworth, FIA Senior Vice President of Publications, Data and Research.
FIA measures volume and open interest by the number of contracts traded and/or cleared on derivatives exchanges. The statistics are collected on a monthly basis from more than 80 exchanges worldwide.
Other significant highlights in today’s report:
- From a regional perspective, exchanges in the Asia-Pacific region had the largest increase in trading volume, followed by North America. In percentage terms, Latin America grew almost twice as rapidly than Europe.
- From an asset class perspective, the equity markets contributed the most to the global surge in trading activity. Trading volume of equity index futures and options volume soared 51% compared to the first half of 2019, and trading of single stock products rose 34%. Equity products accounted for 59% of total volume in the first half of 2020 and 67% of total open interest at the end of June.
- Trading activity in interest rate futures and options suffered as market participants cut back on their exposures. The total number of interest rate contracts traded in the first half of 2020 was almost unchanged from year ago, and open interest fell by 17%.
- Trading activity in most commodity markets rose by double digits. The non-precious metals category was the exception, with volume declining 3.4%.
- The National Stock Exchange of India continued to be the top exchange in the world by volume, with 3.73 billion contracts traded in first half of the year, up 38% on 2019. Open interest remained at a relatively low level, however, with just 8.95 million contracts outstanding at the end of June, up 7.7% from year ago.
- CME was the second largest exchange by volume, with 2.78 billion contracts traded in the first half of 2020, up 13% on 2019. Open interest fell 28.5% to 100.8 million contracts.
- B3 continued its rapid growth, with trading volume up 55% to 2.73 billion contracts. Open interest also continued to grow, rising 22% to 114.4 million at the end of June.
- Intercontinental Exchange came in fourth with 1.44 billion contracts traded across its exchanges in North America, Europe and Asia, up 27% over 2019.
FIA provides its members with monthly reports on trading activity in the exchange-traded derivatives markets. FIA also publishes statistics on trading activity on swap execution facilities and customer funds held at futures commission merchants in the U.S. To access these statistics, visit our industry data page. For more information, contact Will Acworth at +1 202.466.5460