Since March 3, 2025, MEFF has become the first market to introduce European-style cash-settled options. This standard stock option combines standardization, efficiency, and accessibility, setting a new benchmark in the European financial landscape.
Designed to address the needs of its investors, these options offer an unprecedented opportunity to trade major Spanish equities with greater flexibility and reduced capital requirements.
Initially available on Banco Santander, Banco Sabadell, BBVA, Endesa, Iberdrola, Inditex, Repsol and Telefónica, these options eliminate the need for physical share ownership at expiration and remove early exercise risks, making them a powerful tool for traders and investors.
MEFF is pioneering Europe’s first standardized cash-settled equity options, redefining market efficiency and accessibility. By eliminating early exercise risks and reducing capital requirements, these options enhance liquidity, transparency, and strategic flexibility for investors. This innovation cements MEFF’s position as a leader in financial markets, driving the evolution of equity derivatives in Europe.
A Boost for Income and Value Funds
“This is excellent news for Europe’s income and value funds, which together manage more than 500 billion euros. These funds often hold large portfolios of dividend-paying or value stocks, and now portfolio managers can run call-overwriting strategies without the fear of their shares being called away at expiry. That means they can generate extra income on top of dividends, while at the same time improving risk-adjusted returns by reducing drawdowns. It’s a very practical use case where cash-settled options can make a real difference.”
— Imanol Urquizu, Head of Derivatives - Santander Asset Management
A Gateway for Yield Enhancement in Private Banking
“These cash-settled options are a real step forward for yield enhancement strategies in private banking. Traditionally, private bankers had to rely on over-the-counter structures, which meant complex account setups, collateral agreements, and higher costs with investment banks. By moving into a listed format, everything becomes much simpler — easier to open accounts, easier to manage from a compliance and transparency perspective, and far more efficient on collateral. At the same time, because these contracts are cash-settled, there’s no risk of ending up with shares at expiry. That makes yield enhancement strategies — put writing, call writing, or selling volatility spreads — much more straightforward for private bankers to implement, giving their clients cleaner access to premium income in a safer and more efficient way.”
— Imanol Urquizu, Head of Derivatives - Santander Asset Management
Whether you’re an institutional investor seeking strategic advantages or a retail investor looking for a cost-effective trading solution, this is your opportunity to leverage this financial innovation. Get in touch with our experts.
Contact our experts for more information, here
