The Chicago Mercantile Exchange last month started side-by-side trading of its flagship Eurodollar contract over the Globex2 electronic trading system. The Merc’s Eurodollar contract is one of the world’s most actively traded futures contracts, and accounts for more than half of the exchange’s total futures volume.
’The introduction of side-by-side Eurodollar trading (on July 6) provides our members and their customers with an important choice as they decide how to best access the world’s most heavily utilised short-term interest rate hedging tool,’ says CME chairman Scott Gordon.
Separately, in a step designed to strengthen its new Euro FX contract, CME members voted to transfer trading in Deutsche mark futures onto Globex2 during regular trading hours.
’The move reflects the continuing shift in world currency markets triggered by European Economic and Monetary Union,’ says a statement.
Since January 4, DEM futures and Euro FX futures have traded in the same pit in the CME’s currency complex. The Merc will install Globex2 electronic trading workstations in and around the Euro FX futures and options pits, although DEM options will continue to be traded via open outcry. <?xml:namespace prefix = o ns = “urn:schemas-microsoft-com:office:office” />
The Euro FX contract is sized at 125,000 euro and has roughly twice the notional value of the DEM futures contract. The CME also trades three Euro FX cross rate contracts against the Japanese yen, Swiss franc and British pound.