CME Group » About CME Group » Membership » Types of Membership

Types of Membership

 
 

Overview

CME, CBOT and NYMEX/COMEX memberships are entirely separate from one another and offer access to different products at different rates. These differences reflect the individual histories of each of the exchanges before they became part of CME Group.

For a summary and comparison of firm membership options, see:

CME   |   CBOT   |   NYMEX/COMEX

CBOT Individual Memberships

Description
There are five levels of individual CBOT memberships. Each type determines eligibility for trading certain products at reduced rates and provides access to trading on the CME Group trading floor. A different color trading badge (for wearing on the trading floor) is associated with each level of membership:

(B-1) Full Members:

  • Trades: all financial and agricultural futures and options contracts
  • Badge: Yellow 

(B-2) Associate Members:

  • Trades: all financial futures and options and agricultural options only
  • Badge: Maroon 

(B-3) GIM (Government, Instruments Market) Members:

  • Trades: financial instrument futures
  • Badge: Brown 

(B-4) IDEM (Index, Debt and Energy Market) Members:

  • Trades: Fed Funds, and index futures
  • Badge: Black 

(B-5) COM (Commodity Options Market) Members:

  • Trades: options
  • Badge: Green


Eligibility and Requirements
 To be an individual member of CBOT, you must be an adult and possess good moral character, a good reputation and business integrity. In addition, you must have adequate financial resources to assume the responsibilities and privileges of membership.

 

CBOT Corporate Memberships

Description
CBOT corporate membership allows member firms to receive preferential Exchange fee and performance bond rates on its proprietary trading of eligible CBOT products when such proprietary trading activity is conducted in accordance with CME Group’s Fee Policies.

A CBOT corporate member firm may be a CBOT Rule 106.J. Equity Member Firm (requires membership and shares) or a CBOT Rule 106.H. Trading Member Firm (requires a membership).

Hedge funds and commodity pools may be CBOT Rule 106.S. Family of Funds Equity Member Firms (requires membership and shares) or CBOT Rule 106.S. Family of Funds Trading Member Firms (required membership).

Eligibility and Requirements
CBOT Rule 106.J. Equity Membership

  • Financial institutions, futures commission merchants, foreign brokers, broker-dealers, commodity trading advisors, introducing brokers, commercial entities, proprietary trading firms, market makers, cash grain firms and other corporate entities are eligible for CBOT Rule 106.J. equity member firm status and may receive reduced Exchange fee rates on their proprietary trading activity. Hedge funds and commodity pools are not eligible for CBOT Rule 106.J. equity membership.
  • The member firm is required to own or have assigned to it either a B-1/Full membership and 30,000 shares of CME Group or a B-2/Associate membership and 8,750 shares of CME Group. If the member firm is also a CME clearing or Rule 106.J. equity member firm or a NYMEX clearing or Rule 106.J. member firm, it must own or assign 45,000 shares. If the CBOT Rule 106.J. equity member firm has a 8,750 share requirement, the combined share requirement will be 38,750. If the member firm is also a CME clearing or Rule 106.J. equity member firm and NYMEX clearing or Rule 106.J. member firm, it must own or assign 60,000 shares. If the CBOT Rule 106.J. equity member firm has a 8,750 share requirement, the combined share requirement will be 53,750.
  • The member firm is eligible for preferential Exchange rates on products within the division of membership owned or assigned. The membership and one-half of the shares may be owned by the member firm or owned by a member firm affiliate, a principal or employee of the member firm or a parent company of the member firm with an acceptable proprietary interest in the member firm and assigned for the member firm’s privileges. The remaining shares may be independently assigned.
  • The membership may be held by the member firm, a member firm affiliate, a principal or employee of the member firm or a parent company of the member firm with an acceptable proprietary interest in the member firm. The principal or employee must be approved for CBOT individual membership.
  • The member firm is eligible for preferential Exchange fee rates for its proprietary trading of products (open auction and electronic) within the division of membership owned or assigned when such trading activity is conducted in accordance with CME Group Fee Policies. The trading activity of parent companies, affiliates, subsidiaries or customers of the member firm are not eligible for preferential Exchange fee rates. The trading activity of parent companies, affiliates and subsidiaries of the member firm may be eligible for preferential Exchange fee and performance bond rates under CBOT Rule 106.I. affiliate corporate membership.
    • CBOT Rule 106.I. affiliate corporate membership may be obtained by an affiliate of CBOT Rule 106.J. equity member firm. The affiliate may qualify as either a CBOT Rule 106.I. affiliate equity member firm (requires either a B-1/Full membership and 30,000 shares or a B-2/Associate membership and 8,750 shares) or as a CBOT Rule 106.I. affiliate trading member firm (requires a B-1/Full, B-2/Associate, B-4/IDEM or B-5/COM membership).
    • The CBOT Rule 106.J. equity member firm may also qualify an unlimited number of affiliates if it qualifies as a CBOT membership umbrella firm. A CBOT Rule 106.J. equity member firm may qualify as a CBOT membership umbrella firm if it owns fourB-1/Full memberships, two B-2/Associate memberships and 30,000 shares of CME Group. This includes the memberships and shares required for the member firm’s equity member firm privileges. The affiliates must be approved as Rule 106.I. Qualified Affiliates.
CBOT Rule 106.H. Trading Membership
  • Financial institutions, futures commission merchants, foreign brokers, broker-dealers, commodity trading advisors, introducing brokers, commercial entities, proprietary trading firms, market makers, cash grain firms and other corporate entities are eligible for CBOT Rule 106.H. trading member firm status and may receive reduced Exchange fee rates on their proprietary trading activity. Hedge funds and commodity pools are not eligible for CBOT Rule 106.H. trading membership.
  • The member firm is required to own or have assigned to it either a B-1/Full, B-2/Associate, B-4/IDEM or B-5/COM membership. Shares of CME Group are not required. The member firm is eligible for preferential Exchange rates on products within the division of membership owned or assigned. The membership may be owned by the member firm or owned by a member firm affiliate, a principal or employee of the member firm or by a person, including a parent company, with an acceptable proprietary interest in the trading member firm and assigned for the member firm’s privileges.
  • The membership owned or assigned may be held by the member firm or a principal or employee of the member firm. The principal or employee must be approved for CBOT individual membership.
  • The member firm is eligible for preferential Exchange fee rates for its proprietary trading of products (open auction and electronic) within the division of membership owned or assigned when such trading activity is conducted in accordance with CME Group Fee Policies. The trading activity of parent companies, affiliates, subsidiaries or customers of the member firm are not eligible for preferential Exchange fee rates. However, the trading activity of a parent company, affiliate or subsidiary of the member firm may be eligible for preferential Exchange fee and performance bond rates as CBOT Rule 106.I. affiliate trading member firm (requires a B-1/Full, B-2/Associate, B-4/IDEM or B-5/COM membership ).
CBOT Rule 106.S. Family of Funds Equity Member Firm
  • Hedge Funds, commodity pools or fund management companies are eligible for CBOT Rule 106.S. family of funds equity member firm status. The member firm may qualify up to 6 funds within the family of funds managed by the same fund management company for preferential Exchange fee rates. Managed accounts are not eligible for preferential Exchange fee rates.
  • The Rule 106.S. family of funds equity member firm is required to own or have assigned to it four B-1/Full memberships, two B-2/Associate memberships and 30,000 shares of CME Group. If the member firm is also a CME clearing or Rule 106.J.equity member firm or a NYMEX clearing or Rule 106.J. member firm, it must own or assign 45,000 shares. If the member firm is also a CME clearing or Rule106.J. equity member firm and NYMEX clearing or Rule 106.J. member firm, it must own or assign 60,000 shares. One-half of the required Exchange Memberships (i.e. two B-1/Full and one B-2/Associate memberships) and shares must be owned by the family of funds member firm or owned by the fund management company, by one or more qualified funds, or a person, including a parent company, with an acceptable proprietary interest in the family of funds equity member firm (i.e. "firm owned") and assigned for the member firm’s privileges. The remaining Exchange Memberships and shares may be independently assigned.
  • The "firm owned" memberships owned or assigned to the Rule 106.S. family of funds equity member firm may be held by the Rule 106.S. family of funds equity member firm, the fund management company, a qualified fund, or a person, including parent company, with an acceptable proprietary interest in the family of funds equity member firm.
  • The member firm and its qualified funds are eligible for preferential Exchange fee rates for their proprietary trading of CBOT products (open auction and electronic) when such trading activity is conducted in accordance with CME Group Fee Policies. The trading activity of the investment manager, investors, parent companies, affiliates, subsidiaries or customers are not eligible for preferential Exchange fee rates.

CBOT Rule 106.S. Family of Funds Trading Member Firm

  • Hedge Funds, commodity pools or fund management companies are eligible for CBOT Rule 106.S. family of funds trading member firm status. The member firm may qualify up to 3 funds within the family of funds managed by the same fund management company for preferential Exchange fee rates. Managed accounts are not eligible for preferential Exchange fee rates.
  • The Rule 106.S. family of funds trading member firm is required to own or have assigned to it two B-1/Full memberships and one B-2/Associate membership. Shares of CME Group are not required. One-half of the required Exchange Memberships (i.e. one B-1/Full and one B-2/Associate memberships) must be owned by the family of funds member firm or owned by the fund management company, by one or more qualified funds, or a person, including a parent company, with an acceptable proprietary interest in the family of funds trading member firm (i.e. "firm owned") and assigned for the member firm’s privileges. The remaining B-1/Full Membership may be independently assigned.
  • The "firm owned" memberships owned or assigned to the Rule 106.S. family of funds trading member firm may be held by the Rule 106.S. family of funds trading member firm, the fund management company, a qualified fund, or a person, including parent company, with an acceptable proprietary interest in the family of funds equity member firm.
  • The member firm and its qualified funds are eligible for preferential Exchange fee rates for their proprietary trading of CBOT products (open auction and electronic) when such trading activity is conducted in accordance with CME Group Fee Policies. The trading activity of the investment manager, investors, parent companies, affiliates, subsidiaries or customers are not eligible for preferential Exchange fee rates.


See the links below for more information:

Electronic Corporate

Description
CBOT electronic corporate membership allows member firms to receive preferential Exchange fee and performance bond rates on its electronic trading of eligible CBOT products when such proprietary trading activity is conducted in accordance with CME Group’s Fee Policies.

Eligibility and Requirements
CBOT Rule 106.R. Electronic Trading Membership

  • Financial institutions, futures commission merchants, foreign brokers, broker-dealers, commodity trading advisors, introducing brokers, commercial entities, proprietary trading firms, market makers, cash grain firms and other corporate entities are eligible for CBOT Rule 106.R. electronic trading member firm status for their proprietary trading activity.  Hedge funds and commodity pools are not eligible for CBOT Rule 106.R. electronic trading membership.
  • The electronic member firm is required to lease or have assigned to it either a B-1/Full membership or a B-2/Associate membership.  Shares of CME Group are not required.  The member firm is eligible for preferential Exchange rates on products within the division of membership leased or assigned.  The membership may be leased by the member firm or leased by a principal or employee of the member firm or a person, including a parent company with an acceptable proprietary interest in the member firm, and assigned for the member firm’s privileges.  
  • The membership leased may be held by the member firm, a principal or employee of the member firm or a person with an acceptable proprietary interest in the member firm.  The principal, employee or person with an acceptable proprietary interest in the member firm must be approved for CBOT individual membership.  However, trading floor access is not conferred upon the holder of the membership.  
  • The electronic member firm is eligible for preferential Exchange fee rates for its proprietary trading of products (electronic only) within the division of membership leased when such trading activity is conducted in accordance with CME Group Fee Policies.  The member firm is not eligible for preferential Exchange fee rates on open auction trades and is not granted access to CBOT’s trading floors.  In addition, the trading activity of parent companies, affiliates, subsidiaries or customers of the member firm are not eligible for preferential Exchange fee rates. 


See the links below for more information:

Clearing

Description
Clearing members are highly capitalized, closely monitored and carefully selected companies that stand behind all trades made through CME Group’s Exchanges. Clearing members assume full financial and performance responsibility for all transactions executed through them and cleared by CME Clearing. They are responsible and accountable for every position they carry, whether it is for the account of a member, member firm, non-member customer or their own account.

CME Clearing provides clearing services to CBOT and is a division of CME, through which all trades are confirmed, matched and settled on a daily basis until either offset or delivered and through which all financial settlement is made. In every matched transaction executed through CME, CBOT, NYMEX and COMEX, CME Clearing is substituted as the buyer to the seller and the seller to the buyer, with a clearing member assuming the opposite side of each transaction.

CME Clearing conducts business only with its clearing members, not with their customers, individual members or corporate member firms of the Exchange. Customers, members and member firms must have a relationship with a CBOT clearing member to be able to trade CBOT products. As the contra-side to every position, CME Clearing is held accountable to clearing members for performance on all open positions. CME Clearing, by monitoring and overseeing its clearing members through its Financial Safeguard System, guarantees performance on each contract to protect both buyers and sellers from financial loss.

The clearing member with shares is eligible for preferential Exchange fee rates for its proprietary trading of CBOT products (open auction and electronic) when such trading activity is conducted in accordance with CME Group Fee Policies. The trading activity of parent companies, affiliates, subsidiaries or customers of the clearing member are not eligible for preferential Exchange fee rates. The trading activity of parent companies, affiliates and subsidiaries of the clearing member may be eligible for preferential Exchange fee and performance bond rates as CBOT Rule 106.I. affiliate member firms.

  • CBOT Rule 106.I. affiliate corporate membership may be obtained by an affiliate of CBOT clearing member. The affiliate may qualify as either a CBOT Rule 106.I. affiliate equity member firm (requires either a B-1/Full membership and 30,000 shares or a B-2/Associate membership and 8,750 shares) or as a CBOT Rule 106.I. affiliate trading member firm (requires a B-1/Full, B-2/Associate, B-4/IDEM or B-5/COM membership).
  • The CBOT clearing member may also qualify an unlimited number of affiliates if it qualifies as a CBOT membership umbrella firm. A CBOT clearing member may qualify as a CBOT membership umbrella firm if it owns 4 B-1/Full memberships and 2 B-2/Associate memberships. This includes the memberships required for the firm’s clearing membership privileges. The affiliates must be approved as Rule 106.I. Qualified Affiliates.

Eligibility and Requirements

The requirements for CBOT clearing membership are contained in Chapter 9 of the CBOT rulebook. To become a clearing member for CBOT products, the clearing member must:

Demonstrate fiscal and moral integrity

  • Have sufficient financial capitalization to justify the risks assumed in clearing trades
  • Be a corporation (including C Corporations, Subchapter S Corporations and Limited Liability Companies), a partnership (including Limited Partnerships and General Partnerships) or a cooperative association
  • Guarantee and assume responsibility for all trading activity routed through it by members it qualifies or by any electronic trading system.

Be a CBOT member

  • Must own or have assigned to it two B-1/Full memberships (if registered as an FCM) or one B-1/Full (if not registered as an FCM). One B-1/Full membership (if two B-1/Full memberships are required) must be owned by the clearing member or a person, including a parent company, with an acceptable proprietary interest in the clearing member (i.e. "firm owned"). The remaining membership may be independently assigned.
  • The "firm owned" memberships owned or assigned to the clearing member may be held by the clearing member or an individual. The individual must be approved for CBOT individual membership.

Maintain capital requirements

  • Maintain capital (Adjusted Net Capital for non-Banks and Tier 1 Capital for Banks) at greatest of CFTC or SEC capital requirement or:
    • For non-Banks:
      • $5,000,000 if clearing only exchange-traded futures/options; or
      • $50,000,000 if clearing OTC products.
    • For Banks:
      • $5,000,000,000 if clearing exchange-traded futures/options; or,
      • $50,000,000 if clearing only OTC derivative products.
  • Submit daily segregated, secured 30.7 and sequestered statements through WinJammer system by 12:00 noon on following business day.
  • If non-Bank: Submit monthly Form 1-FRs (for FCM-only firms) or FOCUS reports (for broker-dealers) including Exchange Supplemental Information, through the WinJammer system within 17 business days of month-end
  • If Bank: Submit all financial reports required to be filed with its primary regulator – minimum quarterly basis- filed within 5 days after such statements are filed with it primary banking regulator.
  • If non-Bank: Submit certified financial statements to CME Group’s Audit Department within 60 days of fiscal year-end (for broker-dealers) or 90 days of fiscal year-end (for clearing members which are not registered as broker-dealers)
  • If Bank: Submit certified financial statement within 5 days after such statements are filed with its primary banking regulator.

Deposit a guaranty fund deposit with CME Clearing

  • •Deposit must be the greater of the minimum requirement or the clearing member’s proportionate share of the "Aggregate Guaranty Fund Deposit"

Provide parent guarantees

  • Parent guarantees cover all non-customer proprietary obligations, which include:
    • Performance bond and settlement for non-customer and proprietary positions held and cleared;
    • Non-customer and proprietary trades executed by traders who are qualified by the clearing member, until accepted for clearing by another firm; and
    • Non-customer and proprietary trades executed and processed through give-up systems by the clearing member, until accepted for clearing by another firm.
  • Submit a parent guarantee for any person or entity which owns directly or indirectly five percent or more of the clearing member.
  • Guarantor is liable to CME Clearing for all non-customer and proprietary obligations of the clearing member

Exemptions from the parent guarantee

  • Clearing members may request an exemption from the parent guarantee requirements if:
    • The clearing member maintains $300,000,000 or more in adjusted net capital;
    • The clearing member does not clear, execute and give up, or qualify individual traders who execute non-customer or proprietary trades; or
    • The clearing member meets certain criteria and is determined to have minimal activity in the house origin

 

See the links below for more information:
 
 
 
 
 
Calgary Houston Chicago New York Washington São Paulo Belfast London Singapore Hong Kong Seoul Tokyo
  • © 2013 CME Group Inc. All rights reserved.
  • CME Group is the world's leading and most diverse derivatives marketplace. The company is comprised of five Designated Contract Markets (DCMs). Further information on each exchange's rules and product listings can be found by clicking on the links to CME, CBOT, NYMEX, COMEX and KCBT.