Prof Trades can be conducted in equity, index or currency derivatives (options and futures) listed on and traded via the regulated central derivatives market operated by Euronext.liffe Amsterdam. As the price agreed for a Prof Trade may be more than, less than or the same as the price quoted for the same contract on the regulated central market, professional investors and counterparties can agree a single price for a large order. Professional investors can process large orders without causing price disruptions.

Professional investors active on the OTC market do not want to run the risk that a counterparty may fail to fulfil its financial obligations. This counterparty risk is not a factor in trading on the exchange's regulated central market, and neither does it play a role in Prof Trades, thanks to the role of the Clearing House, LCH.Clearnet S.A., as central counterparty. The Clearing House guarantees that rights and obligations resulting from the conclusion of a derivatives transaction are enforced.

In summary: Prof Trades allow professional investors to process sizeable transactions without running counterparty risk or causing price disruptions. Interchangeable with contracts traded on the regulated market

Once LCH.Clearnet S.A. has cleared a Prof Trade, the contracts are included in the open interest for the relevant option class. The contracts resulting from a Prof Trade are interchangeable with contracts traded via the regulated central market. Professional investors can close all or part of a position they opened via a Prof Trade by concluding opposing transactions on the regulated central market before the contracts expire. Equally, positions opened by means of one or more transactions on the regulated central market can be closed by executing a Prof Trade before the contract's expiry date.

In the traditional OTC market, professional investors have to keep records of their positions among themselves, but this is not necessary for Prof Trades. Once a Prof Trade has been cleared, the resulting position is settled and recorded in the same way as a position created via the regulated central market, therefore, reducing the operational risk of the OTC transaction processing procedure.

Please refer to the publication “Prof Trade Facility” or contact your local account manager for further information on:

• Participants in the Prof Trade Facility
• Matching criteria for Prof Trades Fee Structure for Prof Trades
• ISVs supporting Prof Trades