INTRODUCTION

What is Euro Market ?

-The market that includes all of the European Union member countries - many of which use the same currency, the euro.

- All tariffs between Euromarket member countries have

been abolished, and import duties from all non-member countries have been fixed for all of the member countries.

- The Euromarket also has one central bank for all of the member countries,the European Central Bank.

EXPLAINATION

The Euromarket is a large single market comprised of all member countries, allowing for more efficient trade and the centralization of monetary policy through the ECB. 

The Euromarket is considered a major finance source for international trade, through the money market or eurocurrency, eurocredit and eurobonds.

EUROPE STOCK INDEXES

Dow Jones Euro Stoxx 50 FTSEurofirst 300 Index OMX Baltic Index OMX Nordic 40 S&P Europe 350

Dow Jones Euro Stoxx 50

The EURO STOXX 50 Index, Europe's leading Blue-chip index for the Eurozone, provides a Blue-chip representation of supersector leaders in the Eurozone.

The index covers 50 stocks from 12 Eurozone countries: Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal and Spain

The EURO STOXX 50 Index is licensed to financial institutions to serve as underlying for a wide range of investment products such as Exchange Traded Funds (ETF), Futures and Options, and structured products worldwide.

OVERVIEW

Symbol SX5E Dissemination period09:00 - 18:00

CET Last value - 2600.02 Daily low 2573.56   (11:56) Daily high 2619.89   (09:00) 52 week high 2754.80   (30 Jan

2013) 52 week low 2050.16   (01 Jun 2012)

FTSEurofirst 300 INDEX

The FTSEurofirst 300 Index is a capitalization-weighted price index which uses free-float. It measures the performance of Europe's largest 300 companies by market capitalization.

It closely tracks the benchmark index, FT/S&P-AWI Europeand covers 70% of Europe's market cap. The index was developed with a base dateof December 31, 1985.

OTHER INDEXES

OMX Baltic Index - covers stock exchanges in Estonia, Latvia and Lithuania

OMX Nordic 40 - market value-weighted index of the 40 most-traded stock classes of shares in Copenhagen, Helsinki, Reykjavik and Stockholm.

S&P Europe 350 - free float market cap weighted index. Covers at least 70% of European equity market capitalization

ECMI – EUROPEAN CAPITAL MARKETS INSTITUTE

An independent research institution that strives to spread information pertaining to European markets.

The ECMI's main goals are to instigate discussions and debates on the subject of the European markets and to be a major contributor in the discussions on behalf of the research conducted at the Institute.

The ECMI is managed by the Centre For European Policy Studies.

EUROPEAN STYLE OPTIONS

European Style Option, or European Option, is one of two options exercise styles in options trading.

The other being the American Style Option. The main difference between European Style Options and American Style Options is the fact that European Style Options can only be exercised during expiration while American Style Options can be exercised at anytime prior to expiration.

Consequently, due to this difference, the pricing method of European Style options and American Style options are also different. Generally, European style options are cheaper than American style options due to the lack of flexibility in exercising.

CHARACTERISTICS

In fact, European style options are AUTOMATICALLY exercised upon expiration if they are in the money at that point in time which makes them behave more like futures contracts.

However, they can be sold at any time prior to expiration (or rather by 1 day before expiration) in order to take profit or stop loss

European style options typically stops trading the day before expiration, which makes it impossible to sell the option right before expiration when the profit might be highest.

The settlement price of an European style option is also very different from American style options. American style options simply use the final traded price on expiration day as the settlement price while European style options go through a mark to market process much like in futures trading to determine the final settlement price.

EUROPEAN STYLE OPTIONS PRICING

European Style Options are generally cheaper than American style options due to not being able to be exercised prior to expiration. By cheaper, we mean it carries a lower extrinsic value

Black-Scholes Model which is so widely used in options trading today is an options pricing model for European style options

How Do We Tell If An Option Is European Style?

Almost all cash settled options are European Style options. So, if you are buying cash settled options, there is an extremely high chance that it is an European style option.

Most index options are cash settled options. If you are buying futures options, there are chances that there may be both European and American style options available, so you need to check with your exchange for details before committing to a trade.

You can check if an index option is American Style or European style in the US market by going to OIC's Product Specification Page.

POPULAR EUROPEAN STYLE OPTIONS

DAX cash options SMI cash options FTSE100 cash options

TOP 5 MUTUAL FUNDS OF EUROPE MARKET

DFA United Kingdom Small Company Portfolio

Invesco European Small Company Fund

Virtus Greater European Opportunities Fund (VGEAX)

Invesco European Growth Fund (AEDAX)

Royce European Smaller Companies Fund (RISCX)

DOMINANCE OF EUROPE IN AFRICAN COUNTRIES

Beginning in the early 18th century,Europe had a technological lead over other parts of the world,particularly in terms of weapon development

Also,in social terms most African peoples were organized tribally,whereas European powers had not only developed a strong sense of nationalism,but also evolved more centralized nation states,which could therefore concentrate their resources much more effectively to obtain national objectives

As America was already spoken for,Africa was the nearest continent to Europe in terms of sailing distance,so as time progressed this became the focus of colonial expansion for European countries.

THE SINGLE MARKET

The Single Market is one of a kind as it guarantees ‘free movement' of people, goods, services and capital.

At a practical level, it provides the possibility for EU citizens to live, work, study and do business throughout the EU, as well as enjoy a wide choice of competitively priced goods and services.

EXTERNAL TRADE

External trade for Europe has always been very important to the success of the European Union.

In recent years the level of trade has increased and they are continuing to grow as major players in the world of trade.

Today, the EU accounts for 20% of global imports and exports and is now the world's biggest trader.

EUROPEAN SOVEREIGN CRISIS

A period of time in which several European countries faced the collapse of financial institutions, high government debt and rapidly rising bond yield spreads in government securities.

The European sovereign debt crisis started in 2008, with the collapse of Iceland's banking system, and spread to primarily to Greece, Ireland and Portugal during 2009.

The debt crisis led to a crisis of confidence for European businesses and economies.