Over the last 180 years, thousands of futures contracts have been introduced by exchanges around the globe. While many fail, there are a few that become blockbusters. Like many other ventures in business, the majority either see limited success or fail. For example, 3M company has introduced various new products during its life, but only a select few have enjoyed the success of Post-it Notes or Scotch Tape.
CME Group is no different. We have launched products that traded little to no volume in their first few months, but every once in a while, we see a blockbuster product like Eurodollar futures or S&P 500 futures, which trade millions of contracts each day with extraordinary liquidity.
What differentiates success from failure in futures contracts? Is there something that can help predict success? If you examine our huge successes, you see a few things in common. If one or more of these key ingredients are lacking, chances for success are sub-optimal.
It is possible for a futures contract to be a hit without some of these, but when you look at contracts with less volume and activity, it is because they lack most of these ingredients. On the other hand, the successful contracts like Eurodollars, Crude Oil, Gold, Stock Indexes and others have all four attributes.
As the world's leading and most diverse derivatives marketplace, CME Group is where the world comes to manage risk. Comprised of four exchanges - CME, CBOT, NYMEX and COMEX - we offer the widest range of global benchmark products across all major asset classes, helping businesses everywhere mitigate the myriad of risks they face in today's uncertain global economy.
Follow us for global economic and financial news.