Euronext

What Is Euronext?

Euronext is the largest stock exchange group in Europe, and one of the largest in the world. It was originally created via the mergers of the Amsterdam, Paris, and Brussels stock exchanges in 2000.

Over the years, it has since merged with several other exchanges, most notably the New York Stock Exchange (NYSE), before itself being acquired by the Intercontinental Exchange (ICE). In 2014, Euronext was spun off to become an independent entity once again.

Since becoming independent, the organization has grown its presence, incorporating the Irish Stock Exchange and the Italian stock exchange to create Euronext Dublin in 2018 and Euronext Milan in 2021.

Key Takeaways

  • Euronext is a large, global stock exchange group, originally the combination of three former exchanges from France, Belgium, and the Netherlands.
  • The company was once acquired by Intercontinental Exchange but now has returned to operating independently.
  • Euronext operates exchanges in Paris, Amsterdam, Brussels, Lisbon, Dublin, Oslo, and Milan.
  • Many popular European benchmark indexes are created by Euronext, such as AEX, BEL 20, CAC 40, and PSI 20.
  • Euronext's offerings cover a wide array of assets, including equities, exchange traded funds (ETFs), warrants and certificates, bonds, derivatives, commodities, and indices.

Understanding Euronext

Euronext was formed in 2000 with the merger of three national European exchanges: Paris, Amsterdam, and Brussels. It later acquired the Portuguese stock exchange and the London International Financial Futures and Options Exchange (LIFFE), expanding its offerings to include equities, exchange traded funds (ETFs), warrants and certificates, bonds, derivatives, commodities, and indices.

It maintains headquarters in Amsterdam with major offices in Brussels, London, Lisbon, Dublin, Oslo, Milan, and Paris. As of 2021, Euronext listed 1,900 issuers representing more than €6 trillion (euros) in market capitalization.

Some of its more notable benchmark equity indexes include:

  • AEX in Amsterdam
  • BEL 20 in Brussels
  • CAC 40 in Paris
  • PSI 20 in Lisbon
  • Euronext 100—a pan-European blue-chip index

Timeline of Euronext's Milestones

  • 2000: Euronext NV was formed by merging the stock exchanges of Paris, Brussels, and Amsterdam.
  • 2002: Euronext buys LIFFE and the Portuguese stock exchange.
  • 2005: Alternext created.
  • 2007: Euronext merges with New York Stock Exchange to create NYSE Euronext.
  • 2010: Euronext London created.
  • 2013: Intercontinental Exchange (ICE) buys NYSE Euronext.
  • 2014: Euronext re-emerges from ICE via an initial public offering (IPO). (ICE retained ownership of the New York Stock Exchange and LIFFE.)
  • 2018: The Irish Stock Exchange joins Euronext as Euronext Dublin.
  • 2020: Euronext Securities Copenhagen becomes part of the network of Euronext CSDs.
  • 2021: The Borsa Italiana stock exchange in Milan becomes Euronext Milan.

Corporate Services

Euronext provides its listed companies with a variety of services to address their needs. These include services in two broad categories:

  1. Investor relations and communications
  2. Government and compliance.

Under investor relations and communications, Euronext provides advisory on environment, social, and corporate governance (ESG) practices, helping to attract new investors and improve a company's profile in the market. Euronext provides shareholder analysis, post-listing advisory, investor relations management, and webcast solutions.

Under the government and compliance category, Euronext helps listed companies with liability logs, trade logs, and integrity logs, ensuring that all company transactions are above board. Euronext also helps companies comply with EU market abuse regulations and provides solutions for the board.

Post-Trade Services

Post-trade services include clearing, settlement, and custody, and are core offerings of any exchange. The purpose of these services is for the issuance and safekeeping of financial securities, as well as the settlement and clearing of all transactions.

As of November 2021, Euronext's listed products include 1,937 equities, 52,261 bonds, 3,376 ETFs, and 3,151 funds.

These post-trade services fall under Euronext Securities and Euronext Clearing. Under Euronext Securities, Euronext provides settlement and custody solutions for listed companies, which included assisting in funding needs, supporting the capital markets, and any ancillary services, such as tax and investor services.

Euronext Clearing focuses on cash equity, listed derivatives, repos, fixed income, ETFs, and the commodities market. Euronext Clearing provides clearing services across many European venues, acts as a clearinghouse, and provides risk management services.

Products Traded on Euronext

The two main product categories on Euronext are cash/spot and derivatives. Under the cash/spot category, Euronext offers shares/equities, fixed income, funds, ETFs, warrants and certificates, and indices.

Under the derivatives category, Euronext offers equity derivatives (stock options, stock futures, ETF options, index derivatives, and dividend derivatives), FX derivatives (currency pairs), and commodities.

Regulation of Euronext

Euronext falls under the "Regulated Markets" jurisdiction under the Markets in Financial Instruments Directive II (MiFID II) and has to adhere to all of the rules and regulations under MiFID II. Euronext Amsterdam, Brussels, Dublin, Lisbon, London, Oslo, and Paris, all have to abide by these regulations.

In addition, Euronext operates many other markets that are considered Multilateral Trading Facilities (MTFs) under MiFID II and have their own rule books to follow.

Who Can Trade on Euronext?

Euronext's trading members include investment banks, retail banks and brokers, independent trading firms, liquidity providers, market makers, and local brokerage firms.

How Do I Buy Euronext Shares?

An investor wouldn't buy Euronext shares specifically but rather the listed shares of companies on the Euronext exchanges. To buy these shares an investor needs to open a brokerage account, fund the account, and then purchase the shares of the company they are interested in.

Where Is Euronext Located?

Euronext is headquartered in Amsterdam but operates markets in Paris, Brussels, Dublin, Lisbon, Milan, and Oslo.

Article Sources

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  2. LeapRate.com. "Euronext Spins off From ICE in$1.2 Billion IPO." Accessed Dec. 22, 2021.

  3. ICE. "IntercontinentalExchange Completes Acquisition of NYSE Euronext." Accessed Dec. 22, 2021.

  4. Euronext. "Our Organisation." Accessed Dec. 22, 2021.

  5. Euronext. "About Us." Accessed Dec. 22, 2021.

  6. Euronext. "Live Markets." Accessed Dec. 22, 2021.

  7. Euronext. "Indices." Accessed Dec. 22, 2021.

  8. Euronext. "Our Services." Accessed Dec. 22, 2021.

  9. Euronext. "Post-Trade Services." Accessed Dec. 22, 2021.

  10. Euronext. "Fast and Easy Access to European Markets." Accessed Dec. 22, 2021.

  11. Euronext. "Euronext Securities." Accessed Dec. 22, 2021.

  12. Euronext. "CC&G Becomes Euronext Clearing." Accessed Dec. 22, 2021.

  13. Commodity.com. "How To Trade at Euronext in 2021 - A European Trading House Examined." Accessed Dec. 22, 2021.

  14. Euronext. "Regulation." Accessed Dec. 22, 2021.

  15. Euronext. "Euronext FAQ Widget." Accessed Dec. 22, 2021.

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