157 Analysing costs of derivatives clearing – transaction cost studies r assessment of clearing members’ average direct and indirect costs (sec- tion 5.2.4); r analysis of clearing members’ unit costs (section 5.2.5); r benchmarking of derivatives clearing versus other market infrastructure costs (section 5.2.6); r identification of cost reduction scenarios for clearing members (sec- tion 5.2.7); r presentation of non-clearing members’ perspectives (section 5.2.8); and r introduction of cost reduction scenarios for non-clearing members (section 5.2.9). 5.2.1 Clearing house fees The comparison of clearing house fees is valuable for different reasons. Firstly, the prev ious section showed that as the core driver of clearing costs, clearing house fees have great relevance for high volume clearing members with a prop. focus; but the fees ultimately represent an important cost component for all clearing member types. Secondly, clearing house charges constitute the basis for the subsequent analyses, such as the estimate of total European clearing industry costs (section 5.2.3), 61 which in turn a llows for conclusions on the average direct and indirect costs of the various low, medium and high volume clearing member types (section 5.2.4) and their unit costs (section 5.2.5). For the comparison of per-contract fees, the major European clearing houses (Eurex Clearing, LCH.Clearnet, OMX Clearing, MEFF and CC&G) were chosen to constitute the p eer group to be benchmarked against the two largest US derivatives clearing houses, the CME and the OCC. For the pur- pose of this analysis, fees a re not compared on a per-contract basis, but with reference to a hedged amount of €500,000. The fee levels presented in the following thus signify the charges for a single derivatives transaction worth €500,000. 62 The reference date for the analysis was 29 September 2006. 63 61 Clearing house charges constitute the only publicly available information on the transaction costs of derivatives clearing. As interviewees refused to provide quantitative details on their direct and indirect costs, any further cost calculation must therefore be based on publicly available data. 62 This type of analysis facilitates the comparison of the per-contract fees charged by clearing houses by equalising the different contract values. Although it can be assumed that the contract value is at least to some extent reflected in the fee levels set by clearing houses, a comparison of per-contract fees runs the risk of yielding incommensurable results. 63 29 September 2006 thus served as the reference date for exchange rates and the value of the respective underlying. 158 Clearing Services for Global Markets The fee levels of three different product groups, i.e. equity, equity index and interest rate products, are compared. For each product group, benchmark products were chosen according to comparability and volume within the respective product group. In other words, whenever possible, the products with the highest number of contracts cleared were selected as bench- mark products. 64 Thefeesspecifiedhavebeenroundeddownoruptothe nearest integral number. 65 Comparing clearing fees is problematic when all- in fees (comprising trading and clear ing fees) are charged by clearing houses or exchanges. As this is indeed the case for Eurex Clearing and OMX, 66 the following workaround was implemented: in order to ensure comparability with the fee levels of Eurex Clearing and OMX, trading fees were included in the analysis. Whereas the OMX fees thus represent the combined charges for trading and clearing, an artificial fee split was developed to separate the trading and clearing components out of the all-in fees charged by Eurex. 67 Despite the inclusion of trading fees, the focus of the analysis is on the fees charged by clearing houses. Note that whenever reference is made to Eurex’s clearing fee in the following analysis, this fee represents an artificial estimate. Should Eurex decide to separate its combined fee into trading and clearing components at any point in the future, it must be assumed that this will result in entirely different clearing fees. For a comprehensive overview of all fees and details on the calculation, refer to Appendix 6. Following a brief description of the benchmark analysis of equity, equity index and interest rate fees, the findings are summarised and interpreted. 64 Based on the assumption that the highest volume products enjoy the most competitive pricing and are thus best suited for a benchmark analysis, they were selected as benchmark products when- ever possible. For the purpose of this analysis, the results of the comparison of benchmark prod- ucts are generalised according to the respective product category. It should be taken into account that this generalisation of results might not be applicable to all products within a specific product category. 65 Decimal places 0.1 to 0.4 were rounded down; decimal places 0.5 to 0.9 were rounded up. 66 Furthermore, OneChicago charges all-in fees for single stock futures and Euronext.liffe charged an all-in fee for equity derivatives traded on the Amsterdam market and cleared through LCH.Clearnet until November 2006. Since then, Euronext.liffe and LCH.Clearnet have charged separate tr ading and clearing fees. 67 Eurex and the Clearing Corporation planned to charge a link fee of €0.05 for the clearing of the Eurex’s CFTC-approved euro-denominated products. The average transaction fee for these products is approximately €0.30. It is assumed that the value of the link fee approximately resembles the stand-alone value of Eurex’s clearing service. For the purpose of this analysis, the clear ing and trading fees are thus assumed to be equivalent to 17 and 83 per cent of the all-in fee, respectively. Note that this calculation serves the purpose of approximation only. The average transaction fee of €0.30 includes both a trading and a clearing fee component. Calculating the exact fee split would thus require taking this factor into account. 159 Analysing costs of derivatives clearing – transaction cost studies 0 20 40 60 80 100 120 140 200 220 1,500 50 100 150 200 250 300 350 1,000 No. of cleared contracts in m.Fees in EUR Equity options clearing fees Equity futures clearing fees Equity options trading fees Equity futures trading fees No. of contracts cleared in benchmark product in 2005 Hedged Amount: 500,000 / Reference Date: 29 September 2006 Eurex 24 36 OMX 91 200 MEFF 18 18 CC&G 74 73 CME/OCC 14 LCH.C 90 48 72* * LCH.C as of January 2007 0 OCC 26 (CBOE) 18 (ISE) Figure 5.8 Clearing and trading fees for €500,000 hedge in equity options or equity futures 68 Source: Author’s own; based on clearing houses’ published fee schedules. Figure 5.8 provides an overview of clearing and trading fees for a €500,000 hedge in individual equity options or single stock futures. The left axis displays the respective fees charged for the transaction in euros. The right axis refers to the number of cleared contracts in millions of contracts, i.e. the volume of individual equity options and single stock futures cleared through the respective clear ing house in 2005. 69 The sequence of the clearing houses as presented in the figure is sorted by these cleared volumes. The volume 68 Single stock futures traded on OneChicago can be cleared at the CME or OCC. Whilst OneChicago charges all-in fees for single stock futures, the assumed fee split is artificial and based on estimates from expert interviews. 69 The volume of cleared products is exhibited on an annual basis rather than on a monthly basis because clearing houses are more likely regularly to rev iew their pricing structure with reference to annual figures rather than to any short-term data. 160 Clearing Services for Global Markets information is included in the analysis to evaluate whether or not clearing houses tend to translate higher volumes in benchmark products into lower fees. 70 A comparison of the trading and clearing fees charged for a €500,000 hedge in individual equity derivatives reveals that trading fees are generally higher than clearing fees. The significant variation of total fees within the peer group is largely due to the different trading fees charged by the exchanges rather than to substantial differences in clearing house fees. The clearing of the equity options hedge is cheapest at the OCC and Eurex Clearing (ECAG), with the OCC charging approximately €3 and ECAG claiming €4. At €9, MEFF’s are roughly twice as high as ECAG’s clearing fees; at €12, CC&G charges are triple their fee. At the reference date, LCH.Clearnet’s clearing fees were at a non-competitive level, with €24 charged for the hedge. On 27 September 2006, the firm announced a reduction of these clearing fees as of January 2007, 71 resulting in charges that were more in line with those of its peers (i.e. €6forthehedgeinequityoptions). For the hedge in single stock futures, Eurex Clearing, LCH.Clearnet and the CME/OCC each charge clearing fees of roughly €6, while MEFF charges €9 and CC&G€13. It isapparent that OMX charges the highest all-in fees for both equity options and single stock futures. Whereas its charges for equity options are on a par with the combined trading and ‘old’ clearing fees charged by Euronext.liffe and LCH.Clearnet, fees charged for single stock futures appear to be extraordinarily high. At €200, its fees are roughly three times higher than those charged by CC&G and IDEM (the Italian derivatives exchange) as well as fourteen times higher than OneChicago’s combined clearing and trading fees. Figure 5.9 exhibits clearing and trading fees for a €500,000 hedge in index options or index futures. 72 Clearing the hedge in index options is cheapest in the US; the OCC charges 13 cents. In Europe, LCH.Clearnet offers the most competitive rate at 25 cents. Eurex Clearing charges more than twice as much, i.e. 65 cents for the hedge in index options. Lastly, CC&G charges €1.56 for clearing services. 70 This helps to provide first evidence of the existence of economies of scale on the part of the clearing houses. Note that a final conclusion on this issue is not possible without taking into account the production costs of clearing houses. A more detailed analysis of clearing house production costs and the existence of economies of scale is provided in Chapter 6. 71 Cf. LCH.Clearnet (ed.) (27.09.2006). 72 Refer to Appendix 6 for details on which products were chosen for the benchmark analysis. 161 Analysing costs of derivatives clearing – transaction cost studies 0 2 4 6 8 10 12 14 16 18 390 30 60 90 120 150 180 210 360 No. of cleared contracts in m.Fees in EUR Hedged Amount: 500,000 / Reference Date: 29 September 2006 OMX 17 17 MEFF 5 CC&G 6 3 OCC 1 LCH.C 2 2 Eurex 4 4 CME 1 Index options clearing fees Index futures clearing fees Index options trading fees Index futures trading fees No. of contracts cleared in benchmark product in 2005 Figure 5.9 Clearing and trading fees for €500,000 hedge in index options or index futures Source: Author’s own; based on clearing houses’ published fee schedules. An analysis of the fees for the hedge in index futures reveals that clearing is cheapest in Europe, with 25 cents charged by LCH.Clearnet. The CME charges 30 cents for clearing the hedge, Eurex Clearing and CC&G both demand 65 cents and MEFF asks €2.50.Thecombinedtrading and clearingfees charged by OMX are again well above the levels charged by its peer group, with €17 charged for both the hedge in index options or index futures. Finally, the fees charged for a €500,000 hedge in interest rate futures are compared. Figure 5.10 provides an overview of relevant fees for cash settled and physically delivered interest rate futures. 73 The analysis shows that the clearing of physically delivered interest rate products is cheapest in Europe, with Eurex Clearing charging 17 cents for the €500,000 hedge. At 30 cents, the 73 Refer to Appendix 6 for details on which products were chosen for the benchmark analysis. 162 Clearing Services for Global Markets 0 0.5 1.0 1.5 2.0 2.5 3.0 9.5 10.0 10.5 900 100 200 300 400 500 600 700 800 No. of cleared contracts in m.Fees in EUR Eurex 1 0.1 MEFF 2.3 LCH.C 0.2 OMX 9.8 1.5 CC&G N.A. CME 0.6 0.1 OCC N.A. Interest rate futures (phys.) clearing fees Interest rate futures (cash) clearing fees Interest rate futures (phys.) trading fees Interest rate futures (cash) trading fees No. of contracts cleared in benchmark product in 2005 Hedged Amount: 500,000 / Reference Date: 29 September 2006 Figure 5.10 Clearing and trading fees for €500,000 hedge in interest rate futures Source: Author’s own; based on clearing houses’ published fee schedules. CME charges almost twice as much for clearing the hedge in T-bond futures; MEFF prices the clearing of its product at 75 cents. 74 Clearing the hedge in cash settled interest rate derivatives is generally cheaper. The cheapest fees are offered in Europe, with Eurex Clearing and LCH.Clearnet both charging 2 cents for the hedge. The CME’s clearing fees are double the amount at 4 cents. The all-in fees charged by OMX are above the combined trading and clearing fees of its peers; its fees for physically delivered interest rate futures are roughly ten times higher than the fees charged by Eurex and roughly four times higher than those charged by MEFF. At €1.50, cash settled interest rate futures are seven-and-a-half times more expensive than products traded at Euronext.liffe and cleared through LCH.Clearnet. 74 The inclusion of MEFF’s product, the Bono 10, is for the purpose of enlarging the peer group only. In 2005, not a single contract was traded in interest rate products at MEFF. 163 Analysing costs of derivatives clearing – transaction cost studies To summarise, the benchmark analysis yielded a number of insights. Firstly, trading fees are in all cases higher than clearing fees. Secondly, the most economical way to execute the hedge is in the form of interest rate derivatives. Hedging in index derivatives is more expensive, but hedging in individual equity derivatives is the most expensive of all. 75 Further, the comparison of fee levels charged by the different European and US clearing houses revealed that with respect to four of the six benchmarked product ty pes, European clearing houses charged lower fees than their US counterparts. However, US clearing houses offer the lowest rates in equity options and index options clearing . In fact, given the disparity between volumes cleared in the US in certain products, such as by the OCC in equity options and by the CME in index futures, and the largest European CCPs, it is surprising that the difference in fees is not greater. It should be taken into account, however, that it is common practice amongst American clearing houses to grant rebates and/or (annual) discounts to certain clearing member types. Such reductions were not taken into account, which distorts any final conclusions. The analysis also serves to illuminate and provide a snapshot of the pricing structure of the benchmarked clearing houses. High volumes do not always seem to translate into lower fees, suggesting that there is room for thereduction of per-contract clearing fees. Eurex Clearing offers competitive pricing for the clearing of equity options, single stock futures and interest rate derivatives. 76 Although the fee split is artificial, its fees for clearing index options and index futures nonetheless appear to be too high. 77 LCH.Clearnet’s fees for single stock futures, index derivatives and cash-settled interest rate products are competitive. 78 Despite the reduction in clearing fees for equity options, these charges still seem excessive. 79 Whereas the clearing fees charged by the CME and OCC for the clearing of single stock futures traded on OneChicago 75 These results are not surprising, because the pricing of derivatives is usually based on a per-contract level. Due to the very high value of one interest rate contract as compared to one index, or individual equity contract, a smaller number of contracts is needed for hedging a certain amount in interest rate derivatives–whichinturnresultsinlowerfeeschargedforthetransaction. 76 An analysis of combined trading and clearing fees, on the other hand, suggests that the all-in fees charged by Eurex could be lower for equity futures and physically delivered interest rate derivatives. 77 In index options, LCH.Clearnet charges half of Eurex’s clearing fees, although Eurex clears double the volume. In index futures, Eurex’s clearing fee levels are equal to clearing fees charged by CC&G, albeit with a volume of cleared contracts that is roughly thirty-seven times higher. 78 An analysis of the combined trading and clearing fees indicates that the trading fees charged by Euronext.liffe for single stock futures could be lower. 79 With more volume cleared in equity options than Eurex, LCH.Clearnet’s new fee is still one-and-a-half times higher than that of Eurex. There is room for improvement with regard to Euronext.liffe’s trading fee; despite volumes that are approximately twenty-two times hig her than those of CC&G and IDEM, its all-in fees are merely 3 per cent lower. 164 Clearing Services for Global Markets are competitive, the CME’s fees for clearing index futures and interest rate derivatives appear over-priced. 80 The fees charged by the OCC for individual equity and index options seem reasonable, but not remarkably so. 81 Taking into account the comparatively low volumes cleared at MEFF and CC&G, both clearing houses’ fees are generally at very competitive levels. 82 The combined trading and clearing fees charged by OMX for equity options and cash-settled interest rate derivatives are relatively high, but within the scope of the peer group. However, the fees charged for single stock futures, index derivatives and physically delivered interest rate products are non-competitive. Overall, the comparative analysis of per-contract fees charged by the major horizontally and vertically integrated European and US clearing houses pro- duced no clear winner in terms of the most competitive fee levels. 5.2.2 Clearing houses’ volume discount schemes As outlined above, the second focus of the cost analysis is on investigating the clearing houses’ volume discount schemes. The purpose of the analysis is to discover which clearing member types – i.e. low, medium or high volume clearers – receive preferential treatment from clearing houses; this serves further to explore particularities of the current structure of the Value Provision Network. Not all clearing houses grant volume discounts, though. Figure 5.11 speci- fies which of the b enchmarked clearing houses employ volume discounts, and in which product categories. It also identifies the criterion used by the clearing house to determine the discounts. When clearing houses utilise the ‘trade size’ as a criterion for discounts, this refers to the number of contracts per trans- action. Other criteria employed are volume thresholds, i.e. a determination of the minimum number of contracts cleared, either on a daily or monthly basis. Usually, volume discounts either translate into reduced per-transaction fees or fee caps. 83 80 Even though CME’s cleared volumes of index futures are roughly seven times higher than those of LCH.Clearnet, CME’s clearing fee is still higher. Taking the trading fees into account changes the result of the analysis, though – CME’s combined trading and clearing fee for index futures is the cheapest rate offered. The same applies to the all-in fees for interest rate products charged by CME; these are at very competitive levels. 81 At first sight, the fees charged for the clearing of equity options seem to be too high, because they are at roughly the same level as those charged by Eurex, albeit with five times higher volumes cleared at the OCC. However, the OCC provides refunds, fee reductions and discounts to its members on an annual basis, which can ultimately lead to a significant reduction of the per-contract fee. 82 Taking the tra ding fees into account suggests that fees charged by IDEM for equity options and single stock futures could be lower in comparison with its peers. 83 Volume discounts can also be granted through annual refunds and discounts. 165 Analysing costs of derivatives clearing – transaction cost studies N.A.YES Daily Contracts N.A.NONONONO Interest Rate Futures CRITERION: N.A.NONONONONONO Index Futures CRITERION: N.A. NO NO YES Monthly Contracts NONO Index Options CRITERION: YES Trade Size NOYES Trade Size NONO Single Stock Futures* CRITERION: N.A.NOYES Trade Size NO Equity Options CRITERION: OCCCMECC&GMEFFOMXLCH.CEurex * Cleared through CME or OCC YES Unspecified YES Trade Size YES Trade Size YES Trade Size YES Trade Size Figure 5.11 Clearing houses’ volume discounts in benchmark products, as of September 2006 Source: Author’s own; compilation based on clearing houses’ websites. 84 The overview shows that except for ECAG and MEFF, all of the other benchmarked clearing houses employ volume discounts. 85 Volume discounts are granted for the clearing of equity options, single stock futures, index options and interest rate future contracts. None of the clearing houses applies a volume-based discount scheme for index futures. Whether or not clearing members generally welcome the implementation of discount schemes again depends on their perspective and business focus. Clearing memberswith aprop. focus welcome any reduction in fees charged by clearing houses; members with an agency focus, however, are often dismissive of such discounts, because the schemes tend to augment the complexity of calculating the fees charged to customers. The need to monitor and track discount levels translates into increased back-office costs. From a proprietary point of view, I quite like fee caps, because we always hit them. But it doesn’t benefit me as an individual from a client point of view. Then yes, it just becomes a pain! 86 84 The key according to which annual refunds are granted by the OCC is not publicly available. Therefore, the OCC’s annual refund policy is not included in the overview. 85 Note that the volume discounts specified for the CME refer to the Equity/Clearing Member pricing and that the discount scheme of OMX concerns combined trading and clearing fees. 86 Statement made by interviewed clearing member representative. 166 Clearing Services for Global Markets (1) 1–15,000 (2) 15,001–30,000 (3) > 30,000 Daily Contracts N.A. CME Futures or Options on Futures N.A.N.A.N.A. Interest Rate Products (1) 1–500 (2) 501–1,000 (3) 1,001–2,000 (4) > 2,000 (1) 1–21,000 (2) > 21,000 Trade Size Monthly Contracts Index Options N.A.N.A. Traded in SEK or EUR N.A. Index Options (1) 1–1,000 (2) > 1,000 (1) 1–2,000 (2) > 2,000 Trade SizeTrade Size SSF Traded in SEK or DKK N.A. Single Stock Futures (SSF) (1) 1–500 (2) 501–1,000 (3) 1,001–2,000 (4) > 2,000 (1) 1–1,000 (2) > 1,000 (1) 1–2,000 (2) 2,001–10,000 (3) > 10,000 (1) 1–6,000 (2) > 6,000 Trade SizeTrade SizeTrade SizeTrade Size Equity Options N.A. Equity OptionsTraded in SEK, EUR or DKK Traded in Paris Applicable Member Type: Discount Level Rate of Reduction: Criterion: Product: Applicable Member Type: Discount Level Rate of Reduction: Criterion: Product: Applicable Member Type: Discount Level Rate of Reduction: Criterion: Product: Applicable Member Type: Discount Level (No. of contracts) Rate of Reduction: Criterion: Product: Equity Options OCCCMECC&GOMXLCH.C Unspecified Unspecified Single Stock Futures –97% –10% –75% –75% –20% –40% > 40% –50% –43% –20% –40% > 40% VERY HIGH VOLUME VERY HIGH VOLUME VERY HIGH VOLUME VERY HIGH VOLUME VERY HIGH VOLUME UNSPECIFIED HIGH VOLUME HIGH VOLUME HIGH VOLUME MED./HIGH VOLUME Figure 5.12 Clearing houses’ volume discounts and benefiting clearing member types Source: Author’s own; compilation based on clearing houses’ websites. 87 Even though the clearing houses are trying to do you a favour by doing this tiered structure, it doesn’t reduce your costs; it actually increases your costs, because you have to track these and pass them on to the customer. So that is a ver y big issue for us. 88 Figure 5.12 details the discount schemes employed by the clearing houses, specifies the benefiting clearing member types and allows conclusions as to whether or not the potential savings through volume discounts are substantial. The overview shows that clearing houses tend to give high volume clearers preferential treatment through discounts. Medium volume clearers hardly ever benefit, and low volume clearers are not eligible for discounts at all. Out 87 Identification of applicable clearing member types is based on estimates that take into account the following information: the number of cleared contracts per year/month/day eligible for discounts; minimum and maximum market share thresholds as defined for low/medium/high volume clearers; and information on average contracts per cleared trade as published by clearing houses. 88 Statement made by interviewed clearing member representative. [...]... section 3.2.2.1 Furthermore, the cross-checking of the data revealed that the figure of €128 million for capital costs in 2005 undervalues the magnitude of capital costs in that it mainly accounts for external financing costs As the empirical research is biased towards the view of collateral-rich clearing members, whose capital base is usually sufficient to cover any clearing- related collateral requirements,... share refers to the clearer’s relative share of the total European exchange-traded derivatives clearing volume, i.e the sum of cleared volumes at Eurex Clearing, LCH.Clearnet, OMX Clearing, MEFF and CC&G 175 Analysing costs of derivatives clearing – transaction cost studies clearers therefore have to bear disproportionately high fixed costs, based on the assumption that they are members of all major... empirical study and feedback from selected interviewees This enabled the calculation of the average annual direct and indirect costs for clearing member archetypes, as outlined in Figure 5.16 For the purpose of this analysis, it was assumed that all of the presented European clearing member archetypes are direct members of all major European clearing houses (Eurex Clearing, LCH.Clearnet, OMX Clearing, ... cost categories All of these factors are detailed in the following paragraphs Whereas the validation of the data on clearing house charges revealed that the above-mentioned figure is in the right magnitude (see Appendix 7 for details), several caveats apply to the interpretation of the indirect cost estimates.91 The estimated €94 million in risk management costs represents the personnel costs pertaining... the empirical study and provide a number of quantitative and qualitative transaction cost analyses These analyses generated important findings that are crucial for the remainder of the study 5.3.1 Findings from empirical study r The expert inquiry revealed that although most clearing members are highly sensitive to clearing costs, few firms apply a structured approach to monitor and manage their total... related to European derivatives clearing and to provide a basis for analysing the impact that certain network strategies between clearing houses have on transaction costs, the third step of the cost analysis provides an estimate of the total European clearing industry costs in 2005 The estimated figure represents the sum of all direct and indirect costs borne by European clearing members in 2005 for clearing. .. centralisation does not necessarily imply a centralisation of client relationships Rather, client relationships are based where the clients are, but clearing management and the functional relationships with the clearing houses, such as back -of ce, IT and risk management, are concentrated in one or several regional or global locations Some clearers ‘follow the sun’ through offshoring instead of regionalisation... correctly Another indirect cost category whose magnitude is structurally underestimated by clearing members is the cost of capital As outlined above, calculating, analysing and understanding the true cost of capital related to clearing is difficult for various reasons When asked to assess the cost of capital, the interviewed clearing members might not have had in mind the full scope of these costs as defined... revealed that clearing house fees are the core direct cost drivers, whereas back -of ce and IT expenditures are the biggest source of indirect costs At the same time, clearers tend to underestimate structurally the significance of cost of capital and risk management costs 5.3.2 Transaction cost analyses – clearing members r The comparative analysis of per-contract fees charged by the major horizon- tally... external financing for clearing The majority of interviewees consequently cited very low costs of capital for derivatives clearing However, as the cost of capital also includes the opportunity cost of capital, i.e the expected return foregone by clearing members due to bypassing other investment alternatives, this cost category is undervalued by the difference of the value of the benchmark portfolio and the . Other factors also impacted the results of the cost analysis, mainly affecting the indirect cost categories. All of these factors are detailed in the following paragr aphs. Whereas the validation. of analysis facilitates the comparison of the per-contract fees charged by clearing houses by equalising the different contract values. Although it can be assumed that the contract value is at. charges for trading and clearing, an artificial fee split was developed to separate the trading and clearing components out of the all-in fees charged by Eurex. 67 Despite the inclusion of trading