Nasdaq Commodities moves to Futures contracts
Effective November 21 2016, Market Makers will solely quote Futures contracts instead of Nordic Electricity DS Futures and EPAD DS Futures contracts. The expected switch in liquidity will further improve the well-functioning market structure and attract broader participation focusing on a more standardised product offering.
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Nordic Power Market
The Nordic power market is one of the most liquid power derivatives markets in the world and it has developed over the past 20 years with the objectives to reduce and minimize risks, increase transparency and protect investors.
In response, Nasdaq Commodities, through the Nasdaq Oslo ASA Exchange and Nasdaq Clearing AB, offers a full suite of Nordic power contracts to ensure that customers’ trading and hedging needs are met. Consequently, the market has achieved a large degree of transparency as approximately 90% of the trading is being reported and cleared. In addition to a wide range of power products, Nasdaq Commodities also offers a broad product suite consisting of other commodity products including European power, Natural Gas, Freight & Fuel Oil, Renewables, Steel, Carbon, Electricity Certificates and Seafood. The Nasdaq Clearing service removes counterparty credit risk and offers netting and margin offsets between all of these markets.
Advantages with trading Nordic power at Nasdaq
Full market access
- One of the world’s leading and most liquid power derivatives exchanges.
- Multiple front-end trading systems available to access all Nasdaq Commodities’ products.
- Easy access to other European power markets through an integrated platform for all products.
- Easy access through a wide range of membership models. Both a well-functioning GCM model and a Direct Clearing Member model.
Speed of execution
- One of the fastest and most functionally complete multiasset trading systems in the world.
- Cost efficiency with low latency.
Efficiency in clearing
- One of the largest clearing houses for power derivatives.
- Removed counterparty credit risk.
- Significant netting and margin offsets.
- Back office systems ensure complete reporting through an open API.
- A fully transparent regulated exchange and CCP.
The Nordic Power product offering
The Nasdaq Commodities offering includes Futures, Deferred Settlement Futures (DS Futures), Options and Electricity Price Area Differential (EPAD) contracts.
Nasdaq Commodities Futures contracts are daily mark-to-market where profits and losses from financial Futures contracts are realized on a daily basis.
In addition to the Futures contracts, Nasdaq Commodities also offers DS Future contracts which are financially settled contracts with similar cash flow settlement structure as the non-cleared physical power contracts i.e. cash settlement during the delivery period.
Nasdaq Commodities offers Nordic power options for trading and clearing. Yearly and quarterly European style Options in addition to Monthly Asian style Options are available for trading and clearing. Option contracts in combination with other Nasdaq Derivatives are valuable tools to manage risk and hedging strategies.
EPADs are Futures and DS Futures reflecting the difference between an e.g., Area Price and a Nordic System Price. EPADs allow members to hedge against the price risk caused by constraints in the transmission grid.
- Exchange opening hours 08:00 – 16:00 CET.
- Clearing opening hours 07:45 – 19:00 CET.
Please see fee list