Block trades are privately-negotiated futures, options or combination transactions that meet certain quantity thresholds which are permitted to be executed apart from the public auction market. All block trades for NYMEX- and COMEX-listed metals contracts are subject to the conditions set forth in NYMEX and COMEX Rule 526.
Block trades are permitted in specified products and are subject to minimum transaction size and reporting requirements. Block trades may be executed at any time at a fair and reasonable price. Further information and guidance on block trade reporting, submission and minimum threshold requirements may be found in the most recent NYMEX & COMEX Market Regulation Advisory Notice concerning block trades as posted on the CME Group website.
|Minimum Quantity Required||Reporting Time|
|10 contracts||Within 15 minutes of the transaction|
Block Calendar Spreads – Calendar spreads and combination transactions may be executed as block trades provided that the sum of the quantities of the calendar spread legs of the transaction meets the minimum block quantity threshold.
For example, a 5-lot Gold Kilo futures (GCK) Apr-15/Jun-15 calendar spread trade would meet the minimum threshold because the sum of the individual legs of the spread (5 + 5 = 10) meets the minimum threshold (10 lots) for the underlying GCK futures. The reporting requirement for the block spread transaction will be 15 minutes.
Inter-Commodity Futures Spreads and Combinations – Such spreads and combination transactions may be executed as block trades provided that the sum of the quantities of the legs of the transaction meets the larger of the threshold requirements for the underlying products.
For example, 7-lot Apr-15 GC (100-oz Gold Futures) and 21-lot Apr-15 GCK (Gold Kilo) spread trade would meet the minimum block threshold as sum of the individual legs (7 + 21 = 28) meets the larger of the block threshold requirements (i.e., for Gold Futures, the minimum block threshold is 25 lots). The reporting requirement for Gold Kilo futures (i.e., 15 mins) will apply for the above spread transaction.
Reporting Block Trades – Block trades for Gold Kilo futures and, more broadly, CME Group metals products may be reported to the Exchange in the following ways:
Participant Qualifications for Block Trades – Each party to a block trade must be an Eligible Contract Participant as that term is defined in Section 1a (18) of the Commodity Exchange Act. Eligible Contract Participants generally include exchange members and member firms, broker/dealers, government entities, pension funds, commodity pools, corporations, investment companies, insurance companies, depository institutions and high net-worth individuals.
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