The migration of options markets to the screen has been dramatic in recent years, with over 66% of options now traded electronically. The use of Request for Quotes (RFQ) on CME Globex has played a key role in enabling that transition to occur by allowing traders to electronically execute multi-leg and hedged options strategies.
- An electronic notification sent to all CME Globex participants that expresses interest in a specific strategy or instrument. The sender can request a specific size on the RFQ but is not obligated to show any preference as a buyer or seller.
- An RFQ is automatically disseminated to the marketplace when a user creates a request for a specific instrument type. This can be a multi-legged spread or a single instrument type. The RFQ alerts interested participants to submit bids and offers on the specified instrument. A user can also submit an RFQ on an existing instrument where there is no market.
- Responding markets are active and tradable. You can hit, lift, post a bid or offer or continue to monitor the market. Just like all trading activity on the CME Globex central limit order book, the RFQ market is completely anonymous.
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- CME Direct for Options Traders
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RFQ functionality is available on CME Direct, a highly-configurable, web-based trading front end for CME Group markets. CME Direct offers hyper-fast options functionality that allows traders to execute covered and multi-leg strategies on CME Globex.
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