Liquid Markets, Powder Contracts
In the second quarter, CME Group began trading International Skimmed Milk Powder futures and options on futures contracts. It is the first exchange-listed dairy contract with physical delivery points located around the world.
Skimmed milk in powder form has become a popular source of protein because it does not require refrigeration, making it easier to transport and store than either fluid milk or dairy products containing fat. Powdered milk is frequently used in infant formula, candy and baked goods. It is also common in U.N. food aid supplies, fallout shelters, developing countries and other locations where fresh milk is not feasible.
Delivery points for the electronically traded product include Auckland, Los Angeles, Newark, Seattle, and Rotterdam.
A Year in Review
CME Group’s 2009 Annual Review is now available. The review reflects the company’s solid performance and its continued efforts to enhance product offerings, extend clearing services and expand partnerships around the world. Corporate highlights include:
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The 2009 Annual Review is available online: www.cmegroup.com/investor-relations/annual-review/2009/.
Web Site Rejuvenation
The CME Group Web site received a makeover recently and will continue to be updated with various enhancements on a regular basis throughout 2010. The redesigned Web site offers:
- Top level navigation allowing improved visibility to contract types for products;
- Consistent contact information;
- Social media links (Twitter, Facebook, LinkedIn);
- Quick access to global content; and
- CME Group strategic partnerships links.
To learn more, please visit www.cmegroup.com and provide comments and suggestions via the Feedback link at the top right corner of each Web page or in the site’s footer.
Total Access
Electronic trading hours have been expanded for the dollar-denominated Nikkei 225 futures listed at CME Group and traded on the CME Globex electronic trading platform.
"Building on our longstanding relationship with Nikkei Inc., we are pleased to be able to offer customers nearly 24-hour access to dollar-denominated Nikkei 225 futures," says Scot Warren, managing director of equity index products and services. "With the new extended hours, our customers will have round-the-clock access to the benchmark index of leading Japanese stocks." Additional information on the expanded hours is available at www.cmegroup.com/trading/equity-index/.
Counterparty and Settlement Risks Top FX Traders’ List of Concerns
While counterparty concerns have eased since last year, they still remain top of the list for foreign exchange (FX) traders, according to CME Group’s third annual Global Foreign Exchange Market Study. The research was conducted by ClientKnowledge in September 2009 and surveyed 952 FX active organizations. Overall, concerns over counterparty risk remain high, albeit reduced slightly from last year.
Key findings include:
- Among banks, 69 percent of respondents cited settlement risk as their biggest concern when supplying e-pricing versus 52 percent last year.
- Worries about counterparty risk remain high, with two-thirds of those surveyed citing it as a concern in 2009.
- Concern about latency increased, up from 16 percent to 29 percent.
- In employing options, banks and investors placed more focus on plain vanilla options versus barrier and exotic options, suggesting that both banks and investors are making the move back to simplicity, liquidity and transparency when trading options.
"This year’s study illustrates that there continues to be a fundamental shift in the global FX market towards risk mitigation," says Derek Sammann, CME Group managing director of financial products.
Download a full PDF version of this issue here.
