Articles tagged by CME
Trying to decipher platform performance
during last month’s UK-inspired mayhem is almost as difficult as keeping track
with the latest shenanigans in UK politics following the vote to leave the EU –
but I’ve had a go and there ...
Thomson Reuters and CME Group will connect
their instant messaging networks, allowing more than 300,000 market
participants to communicate across their platforms.
From late Q3 2016 users of Thomson Reuters’
Eikon Messenger and CME’s Pivot Instant Messaging will be able to ...
CME Group plans to
list six new European-style weekly, monthly and quarterly FX options contracts
that will be available to trade August 8, 2016.
The currency pairs
chosen for the launch are: AUD/USD, GBP/USD, CAD/USD, EUR/USD, JPY/USD ...
After a number of years having to take reactionary measures in
response to new regulatory requirements, panellists at Profit & Loss’ Forex Network New York conference expressed
enthusiasm for a new wave of innovation that has the potential to re-shape FX
CME Group and Moscow Exchange (Moex) have both
reported lower FX volumes in July – largely reflecting the first batch of data
from the OTC platforms earlier this week.
CME says average daily volume (ADV) in its
FX contracts was 724,000, the ...
Thomson Reuters, FX Spotstream and FXCM
have all reported a month-on-month decline in FX average daily volume (ADV),
however the latter two are up on a year-on-year basis.
Thomson Reuters says spot volumes across
its platforms was $97 billion per day, 8.5% ...
The CME Group has
delisted its E-micro USD/JPY and E-micro USD/CHF futures contracts with
The contracts were
listed for trading on CME Globex as well as for submission for clearing via CME
ClearPort. There is no ...
rate swap trading platform TrueEx has added Brazilian real (BRL)
interest rate swaps execution with clearing through CME, to its platform.
new offering allows BRL swaps traders to clear, execute new risk, terminate or
compact positions and process ...
CME Group has issued a 60-day ban against a
trader it accuses of spoofing in its gold and natural gas futures markets – the
ban comes just weeks after a US court sentenced
Michael Coscia to three years in jail for ...
CME Group plans to
list additional contract months for the options on its MXN/USD futures contract
Effective September 11
2016, for trade date September 12 2016, CME will list nine additional contract
months for these options.
The exchange group
already lists ...
The BIS Triennial survey highlights the drop in spot volumes, but how does the platforms' performance compare over the same period?
Most FX major trading venues will be glad to see the back of August – following the downbeat results from FastMatch and Hotspot, four other venues have reported a decline in volumes – two registering historic lows and a third the lowest in seven years. The numbers add up to a horrible month for the platforms and, by association, for the wider foreign exchange industry as activity levels continue to dive following June’s Brexit-inspired spike, most will be hoping for a forex rebound in September.
Just about 10 months ago the deal was announced to sell Icap’s voice business to Tullett Prebon and at that time, in this column, I suggested that a consequence of that deal would be an easier path for anyone looking to buy Icap’s electronic business, subsequently revealed to be named Nex.
Obviously I cited an exchange as the most likely buyer and it seems, if the headlines of last week are anything to go by, that the pieces are being moved into place. Moving pieces is, however, very different to an actual deal – what are the chances of that?
The latest batch of monthly volumes to be reported by the multibank FX platforms are more mixed, after Hotspot, FastMatch and Gain GTX all posted month-on-month and year-on-year increases in their September volumes earlier this week.
Although volumes on EBS, FXSpotStream and CME Group all recovered from August – when trading volumes were significantly down across the board – activity on the first two of these platforms was down year-on-year, while CME posted only a marginal increase in comparison to September 2015.
Duco Technologies will offer its data control and reconciliation services to CME Group members starting January 2017, the two firms announced.
The launch follows a six-month trial period with a limited number of futures commission merchants (FCMs).
Duco's service is designed to enable CME member firms to simplify processes around fee structures without investing in infrastructure or IT resources.
CME chief commercial officer Bryan Durkin comments: "We're pleased to offer our member firms an innovative solution to help streamline their current fee processes. Duco's service will reduce manual work, drive efficiency and ensure accuracy between parties."
There was a fair amount of chatter about the future of Icap (soon to become ‘Nex’) at the recent Profit & Loss Forex Network Chicago conference, with much of it centering around likely purchasers of the company once it sells its global wholesale broking and information business (IGBB) to Tullett Prebon.
“The other broader question hanging around the firm as it transitions into Nex is whether [CEO Michael] Spencer is priming the new entity for a sale,” Profit & Loss noted in an article published prior to the conference last month.
It seems that many of the attendees of Forex Network Chicago had, in their own minds at least, decided that the answer to this question was that the firm is indeed up for sale. The speculation then turned to who would be interested and able to buy the firm.
CME, EBS and FXSpotStream have all released October volume data, and, as was the case with the first group to report, the news is very mixed.
EBS says FX volume averaged $83.8 billion in October, 3% higher than September’s $81.7 billion and a fraction higher than October 2015’s $83.1 billion.
Meanwhile the outlook was gloomier at CME Group where the Merc reported average daily turnover of 771,000 contracts in FX products, 5% higher than October 2015 but down 20.4% on September’s data. Profit & Loss estimates ADV at CME in FX products to be $88 billion in notional value across futures and options on futures.
It was a different picture at FXSpotStream, however, where the platform registered $17.1 billion ADV, up 24.5% from October 2015 and also up 10.3% month-on month.
CME Group has issued an advisory stating that its Global Command Centre (GCC) has taken “emergency action” ahead of this week’s US election by widening the price fluctuation bands on interest rate futures contracts traded on CME and Chicago Board of Trade (CBOT), which is part of the CME Group.
CME says the temporary modification of the price fluctuation limits is a precautionary measure “to ensure fair and orderly trading in these products based on the material likelihood of a marked increase in price volatility expected to result from the General Election vote in the United States to be held of November 8, 2016”.
In what is being seen as a surprise move, Navinder Singh Sarao, the UK-based day trader accused by US authorities of spoofing markets and contributing to the May 2010 flash crash in US equities, has pleaded guilty in a US court appearance following his extradition from the UK.
Sarao, nicknamed the “hound of Hounslow” because he operated at times from a bedroom in his parents’ house in that London suburb, was extradited after being accused of making almost $40 million by entering large bids and offers against his intended trading direction on CME stock futures.
The five clearinghouses under US jurisdiction have passed the Commodity Futures Trading Commission’s (CFTC) first stress test.
The purpose of the test was to assess the impact of a hypothetical set of what the CFTC says is an extreme but plausible market scenarios across multiple clearinghouses and their clearing members.
The analysis included five clearinghouses registered with the CFTC located in the US as well as in the UK, they are CME Clearing, ICE Clear Credit, ICE Clear Europe, ICE Clear US, and LCH Clearnet. It encompassed cleared futures and options, interest rate swaps, and credit default swaps.
The analysis included the largest clearing members (measured by margin deposited) at each clearinghouse.
CME Group will expand its suite of FX derivatives with the launch of six FX monthly futures next month, providing clients with access to the front months of the FX forward curve.
The new contracts are in addition to the existing quarterly futures and will cover EUR/GBP, as well as five major currency pairs against the US dollar: AUD; GBP; CAD; EUR and JPY.
Subject to regulatory approval, the new instruments will be available for trading on CME from 27 February.
The monthly contracts are launching on the pairs where CME is seeing the most activity and demand. Currently the group offers over 90 FX futures and more than 30 FX options.
CME Group has changed its rules regarding FX delivery, putting a cap on the amount of deliverable FX that firms can clear via wire transfer when trading deliverable currency products on its platforms.
Currently, under CME Rule 730 deliverable currency futures contracts are required to be physically delivered through CLS where both the trading unit and price increment currency are supported by CLS delivery procedures, unless the clearing firm’s delivery exposure in any single contract is not expected to exceed $25 million.
The second group of FX platforms to report average daily volume (ADV) for January has generally matched the month-on-month increase reported elsewhere but has suffered a year-on-year drop.
CME Group has gone live with the “triangulation” of its volatility quoted FX options (VQO), a new system that links the VQO, premium quoted options (PQO) and futures books in order to boost liquidity.
VQOs, which were launched on November 14, allow market participants to quote the standard 2:00pm expiration contracts in annualised volatility terms.
When using a VQO, once a trade occurs the implied volatility input is converted into a USD premium using a standard options pricing model and the participants exchange a standard premium option and a delta hedge of standard underlying futures. This enables market participants to trade in volatility and clear in premium.
CME Group says it will change the exercise and assignment rules for all options on FX futures contracts.
On March 24, CME will amend how it handles options that end up precisely at the money on expiry. Currently, CME options that are at least one tick in or out of the-money at expiration are automatically exercised or assigned, and if the final underlying price happens to occur exactly at a strike price, both calls and puts at that strike are also expired without exercise.