A Block Trade is a privately negotiated futures, options or combination transaction that is permitted to be executed apart from the public auction market. Participation in block trades is restricted to Eligible Contract Participants as that term is defined in the Commodity Exchange Act.
Rule 526 ("Block Trades") governs block trading in CME, CBOT, NYMEX and COMEX products. Block trades are permitted in specified products and are subject to minimum transaction size requirements which vary according to the product, the type of transaction and the time of execution. Block trades may be executed at any time at a fair and reasonable price.
Block trade reporting, submission and minimum threshold requirements are set forth in a CME & CBOT Market Regulation Advisory Notice for CME and CBOT products and in a NYMEX & COMEX Market Regulation Advisory Notice for NYMEX and COMEX products. Those notices are available on the Current Market Regulation Advisory Notices page, which may be accessed by clicking here.
If you have questions concerning block trades, please contact the Market Regulation Department at 312-341-7970 or one of the individuals listed in the above-referenced Advisory Notices.
Benefits of Block Trades
How a Block Trade Is Reported
Block trades may be electronically reported to CME Clearing via CME ClearPort. You must be registered in CME ClearPort as a broker to enter trades on your own, or as a trader if you are the designated party to a trade. The CME ClearPort demo provides an excellent introduction for registering and submitting ex pit transactions:
For information on reporting block trades through CME ClearPort, please contact customer service at 1.800.438.8616, via email at ClearPort@cmegroup.com, or visit: www.cmegroup.com/clearport
Almost all block trades may be reported to the GCC. The seller reports the trade by calling the GCC at 312.456.2391 within five minutes of execution. When the GCC is closed, the block trade must be reported no later than five minutes prior to the opening of the next electronic trading session for that product. The seller then has their clearing firm type the trade into Front End Clearing (FEC). Parties/executing brokers familiar with the block trade procedures designated by the Contacting firm can call trades into the GCC without ClearPort registration, although the exchange prefers parties who are ClearPort registered.
The Front-End Clearing System (FEC) is a web-based application that provides Clearing Member firm back office staff with an integrated method for entering/processing a variety of trade types, including:
Member staff can enter, modify and delete trade records using FEC. Give-up and Average Pricing functionality is available. For more information, please consult: http://www.cmegroup.com/clearing/systems-operations/front-end-clearing.html
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